Is THC a high-quality business?

AlphaMadera's AlphaQuality grade scores Tenet Healthcare Corporation on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how THC compares to a Buffett-style quality bar.

What is Tenet Healthcare Corporation's AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to THC based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes THC a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

THC - Tenet Healthcare Corporation

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $259.50 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

B 70.3 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

A 88.7

5yr Avg ROIC 16.8% 84/100
Operating Margin Trend +1.95 pp/yr 99/100

Capital Efficiency

Weight: 15%

A+ 99.4

5yr Avg ROE 31.0% 100/100
5yr Share-Count CAGR -4.4% 98/100

Growth Quality

Weight: 15%

B- 65.0

5yr Revenue CAGR 2.3% 39/100
5yr EPS CAGR 16.5% 90/100
Revenue-Growth Years (5) 4/5 80/100

Cash Generation

Weight: 15%

B 73.0

5yr FCF Margin 6.3% 55/100
5yr FCF/NI Conversion 1.32x 95/100

Balance Sheet

Weight: 20%

C 55.2

Net Debt / EBITDA 2.29x 64/100
Interest Coverage (EBIT/Int) 4.41x 59/100
Altman Z-Score 1.78 34/100

Stability

Weight: 15%

D+ 40.0

EPS Volatility (σ/μ) 1.08 0/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 1/5 80/100

5 of 5 gurus held; 2 added; 3 trimmed.

Holders: 5
Avg Δ position: -28.4%
New buys: 0
Full exits: 0

Wood decreased -87%
Cooperman decreased -78%
Dalio decreased -36%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.