Assessing Whether Community Health Systems Inc. (NYSE: CYH) Is Over- Or Undervalued

BlackRock Fund Advisors has recently announced that it has increased stake in Community Health Systems Inc. (NYSE:CYH) by 6.11%. After grabbing 19.63 million shares, the institutional investor is now in possession of 1.13 million shares of the Healthcare Company. The new investment brought the stake of investor firm to 14.57% having worth around $118.95 million. Moreover, Eversept Partners LP increased its share by 7.01 million to have a control over 9.02 million shares. And The Vanguard Group, Inc. raised its holdings to 0.49 million shares by acquiring 8.89 million shares or 6.60% of the stake.

Community Health Systems Inc. (CYH) concluded trading on 03/15/23 at a closing price of $5.10, with 1.84 million shares of worth about $9.4 million changed hands on the day. Half year performance of the stock remained positive as price took a surge of 69.44% during that period and on Wednesday the price saw a loss of about -5.56%. Currently the company’s common shares owned by public are about 129.16M shares, out of which, 126.20M shares are available for trading.

A deeper look into what the analysts at Wall Street are thinking about the price target of this stock provides us with the following: 12 analysts are covering the CYH stock and their offered price forecasts bring an average price target of $8.85. Over the next 12 months, analysts forecasted that the stock’s price could jump as high as $13.75 and could fall to a lowest price of $6.50. The stock’s current price level is 38.7% above of average price target set by the analysts, while a rise to estimated low would result in gain of 21.54% for the stock. However, touching the estimated high of $13.75 would mean a gain of 62.91% for the stock.

According to filings with the U.S. Securities and Exchange Commission (SEC), insiders took part in trade of the company’s stock for 8 times over the past 12 months. They bought 1,087,957 shares in 6 of the transactions. In 2 selling transactions, insiders dumped 20,914 shares.

iShares Core S&P Small Cap ETF, Vanguard Total Stock Market Index, and Invesco S&P Small Cap 600 Revenue are the top 3 mutual funds which are holding stakes in Community Health Systems Inc. iShares Core S&P Small Cap ETF is currently holding 9.52 million shares of worth totaling $57.72 million. The company recently came buying 23140.0 shares which brought its stake up to 7.07% of the company’s outstanding shares. Invesco S&P Small Cap 600 Revenue, after buying 3.62 million shares, have now control over 2.69% of the stake in the company. It holds 28496.0 shares of worth $21.96 million.

Community Health Systems Inc. (NYSE: CYH) started trading at $5.17, below -$0.23 from concluding price of the previous day. However, the stock later moved at a day high price of 5.51, or with a loss of -5.56%. Stock saw a price change of -11.76% in past 5 days and over the past one month there was a price change of -1.54%. Year-to-date (YTD), CYH shares are showing a performance of 18.06% which decreased to -54.91% when we look at its performance for past 12 months. Over the period of past 52 weeks, stock dropped to lowest price of $1.88 but also hit the highest price of $12.51 during that period. The average intraday trading volume for Community Health Systems Inc. shares is 2.89 million. The stock is currently trading -16.19% below its 20-day simple moving average (SMA20), while that difference is down -4.40% for SMA50 and it goes to 30.83% higher than SMA200.

BlackRock Fund Advisors acquired 19.63 million shares of Community Health Systems Inc. having value of about $118.95 million. Data submitted at the U.S SEC by BlackRock Fund Advisors revealed that the firm now holds 1.13 million shares in the company valued at close to $5767309.5, or have control over 6.11% stake in the company. Community Health Systems Inc. (NYSE: CYH) currently have 129.16M outstanding shares and institutions hold larger chunk of about 82.50% of that. Holding of mutual funds in the company is about 40.55% while other institutional holders and individual stake holders have control over 51.78% and 39.59% of the stake respectively.

The stock has a current market capitalization of $710.53M and its 3Y-monthly beta is at 1.70. PE ratio of stock for trailing 12 months is 21.70, while it has posted earnings per share of $0.23 in the same period. It has Quick Ratio of 1.20. Volatility of a stock is a metric used to know how much the price of that stock is under influence and for CYH, volatility over the week remained 6.28% while standing at 7.86% over the month.

Stock’s fiscal year EPS is expected to drop by -79.90% while it is estimated to increase by 251.40% in next year. EPS is likely to shrink at an annualized rate of -7.95% for next 5-years, compared to annual growth of 15.10% made by the stock over the past 5-years.

Analysts at 12 brokerage firms have issued recommendations for the Community Health Systems Inc. (CYH)’s stock and average of those rates the stock at a “Moderate Buy” and assign it a score of 2.40. Out of those 12 Wall Street analysts, 4 recommended a “Buy” rating, while 8 were in favor recommending the stock as a “Hold” and 0 analyst recommended the stock as “Sell”.

Digging deeper we find that several firms have released their research notes about the support levels of the stock. Most recent of them is a note released by Loop Capital on June 17, 2022 offering a Hold rating for the stock and assigned a target price of $5 to it. Coverage by BofA Securities stated Community Health Systems Inc. (CYH) stock as a Neutral in their note to investors on June 15, 2022, suggesting a price target of $5.50 for the stock. On March 29, 2022, Wells Fargo Initiated their recommendations, while on January 10, 2022, Citigroup Resumed their ratings for the stock with a price target of $18. Stock get a Buy rating from BofA Securities on December 13, 2021.