Essay

HCA Hospital Incorporation is a for profit public organization as evidenced by its financial statements. As a for-profit public organization it must submit its annual report to the United States Securities Exchange and Commission. For-profit organizations must publish their financial statements such as income statement, balance sheet statement, and cash flow statement analysis for public scrutiny. They also trade their shares at stock exchange. HCA Healthcare Incorporation’s share price as at July 19, 2020 was $106.06 (Yahoo Finance, 2020). An analysis of the company’s financial statements shows that the company’s revenue increased from $43.614 billion in 2017 to $46.677 billion in 2018 and $51.336 billion in 2019. Net income attributable to common shareholders for 2017, 2018, and 2019 were $2.216 billion, $3.787 billion, and $3.505 billion, respectively. Cash provided by operating activities were $7.602 billion, $6.761 billion, and $5.426 billion in 2019, 2018, and 2017, respectively. Cash used in investing activities totaled $5.72 billion in 2019 compared to $3.901 billion in 2018 and $4.279 billion in 2017. Cash used in investing activities in 2019, 2018, and 2017 were $1.771 billion, $3.075 billion, and $1.061 billion, respectively (SEC, 2019).

From the demand theory perspective, there is higher demand for healthcare services in the fourth quarter of financial year than the other periods. In fiscal year 2019, revenues for first quarter, second quarter, third quarter, and fourth quarter were $12.517 billion, $12.602 billion, $12.694 billion, and $13.523 billion, respectively. In fiscal 2018, revenues for first, second, third, and fourth quarters were $11.423 billion, $11.529 billion, $11.451 billion, and $12.274 billion, respectively (SEC, 2019). Market behavior can also affect the company’s financial performance. For instance, changes in general economic performance can affect the company’s revenue positively or negatively. Budget deficits at federal entities can have a negative impact on consumer spending and funding for healthcare programs such as Medicare and Medicaid, which represent significant sources of revenue for the organization.

References

United States Securities and Exchange Commission. (2019). Form 10k: HCA Healthcare Inc. Washington, DC: U.S. Government Printing Office