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Investing

Tenet Healthcare: Tired Of Being Bankrupt

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By Douglas A. McIntyre Published
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Yesterday, Credit Suisse said without an industry recovery in volume or patient insurance, Tenet Healthcare (THC) might be required to file for Chapter 11 bankruptcy protection in three years. The company’s stock promptly dropped. The shares had been trading at $3.90 a few day ago, dropped ot $3.29. The shares were over $12 two years ago.

THC took exception to the report. This AM the company released a statement. "We believe we have the financial resources to execute our turnaround," said Biggs C. Porter, Tenet’s chief financial officer. Tenet had $675 million in cash at June 30, 2007 and had no outstanding borrowings on its line of credit which, under its terms, had $500 million in availability as of June 30, 2007. In addition, Tenet has no long-term debt maturing until December 2011.

While bad debt is rising and so is revenue from the uninsured, the company does expect adjusted EBITDA of $675 to $725 million this year.

Not great, but going bankrupt might be a little strong.

Shares opened up 4% at $3.48. The damage appears to have been done.

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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