ARCC

Ares Capital

Fundamental data last updated:April 13, 2026

company profile

SECTOR

Financial Services

industry

Asset Management

Exchange

Nasdaq

County of HQ

United States

Next Earnings Date

04/28/26

Business Summary

Community Health Systems operates acute care hospitals and related healthcare facilities, generating revenue primarily through patient admissions, procedures, and ancillary medical services. Cash flow is driven by volume, payer mix, and reimbursement rates, making operational efficiency critical. The business moat is localized scale—hospitals in regional markets create referral networks and community entrenchment that are difficult to replicate quickly. However, this moat is operational rather than structural, meaning profitability depends heavily on cost discipline, capital structure management, and reimbursement stability rather than proprietary advantage.

VALUATION

P/E

9.7

Market Cap ($M USD)

$12,989

Forward P/E

9.4

PEG

1.3

PRICE TO SALES

8.7

PRICE TO BOOK

0.9

EV / EBITDA

-

5-Year Average P/E

DIVIDEND

Yield

10.60%

Annual Payout

$1.92

Payout Ratio

103.20%

Consecutive Years of Dividend Growth

0

5-Year Dividend Growth Rate

3.70%

Financial Health & Profitability

Earnings Per Share

$1.86

Next Year EPS Growth Estimate

$1.93

Next Year Revenue Growth Estimate

4.30%

Return on Equity (ROE)

9.10%

Operating Margin

-

Debt-to-Equity

1.1

Piotroski F-Score

1

Altman Z-Score

-

Return on Invested Capital (ROIC)

6.70%%

Current Ratio

2

Quick Ratio

Gainseekers Quantitative Analysis

Summary

At a $443M market cap with a Price/Earnings ratio of 0.8 and EPS of 5.6, this stock screens as statistically extreme deep value. However, the lack of a Forward P/E and a collapsing EPS estimate to $3.81 next year signals earnings compression, not growth. An Altman Z-Score of 1 places the company firmly in financial distress territory, meaning the market is discounting real solvency risk rather than simply mispricing temporary volatility. This is not a clean value play—it is a distressed asset priced cheaply for a reason, with upside dependent on stabilization rather than expansion.

AI Exposure / Tech Reliance

As a Medical Care Facilities operator within Healthcare, the business is operationally intensive and less directly exposed to AI displacement risk than asset-light industries. AI adoption would likely focus on administrative efficiency, patient data management, and cost control rather than revenue transformation. Given the -36.50% operating margin, any technology-driven cost improvement would be more about survival than competitive domination.

The Bull Case

A deep value investor will notice the ROIC of 14.30%, which meaningfully exceeds the 2.10% Return on Equity and suggests that, at the operating level, invested capital is still producing respectable returns despite structural strain. The Piotroski F-Score of 7 indicates underlying financial improvement trends relative to distressed peers, signaling operational stabilization. A Current Ratio of 1.5 implies adequate short-term liquidity, and the extremely low P/E of 0.8 suggests that even modest normalization of earnings could re-rate the equity significantly. With EPS at 5.6 against a $443M market cap, the equity is priced as if current profitability is unsustainable—if management merely maintains partial earnings power, upside could be asymmetric.

The Bear Case

The red flags are severe. Debt/Equity at 8.70% indicates heavy leverage relative to equity, and when paired with a -36.50% operating margin, the capital structure becomes dangerous. The Altman Z-Score of 1 confirms balance sheet fragility, and with Sales Growth Next Year projected at -$0.01, there is no visible growth engine to organically deleverage. The absence of a Forward P/E and PEG Forward suggests limited analyst visibility, and a Consensus Rating of 8.70% combined with a Mean Consensus Target Price of 2.9 implies limited institutional conviction. This is a leveraged turnaround in a low-margin business—not a stable compounder.

Market Sentiment & Smart Money

Short Interest %

5.60%

Analyst Consensus

1.53

Average Analyst Price Target

$21.96

Institutional Ownership %

35.10%

1-Year Beta

0.69

Insider Buying % (6 Mo)

0.60%%

Distance to 52-Week High

77.30%%

Distance to 52-Week Low

104.00%%