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Moody's affirms ratings on HCA Healthcare

Moody's affirmed the corporate family rating of HCA Healthcare Inc. at Ba1 with a stable outlook.

The rating agency also affirmed the Nashville, Tenn.-based hospital company's probability of default rating at Ba1-PD and speculative grade liquidity rating at SGL-1.

Moody's stated that the company's corporate family rating takes into account its significant scale and strong competitive positions in growing urban and suburban markets, along with a record of stable operating performance and strong cash flow.

In addition, the agency believes HCA's ratings are curbed due to its geographic concentration in Florida and Texas and its track record of shareholder-friendly policies, as well as the agency's expectation that adjusted debt to EBITDA will remain moderately high.

HCA Healthcare is acquiring Asheville, N.C.-based nonprofit hospital operator Mission Health System Inc. in a deal valued at about $1.5 billion and recently received approval for the deal from North Carolina's attorney general.

Moody's also expects the company to have "very good liquidity" over the next 12 to 18 months, which is represented in HCA's speculative grade liquidity rating.

The stable outlook reflects the agency's expectation that adjusted debt/EBITDA will be maintained in the range of 4.0x to 4.5x. It also takes into account the agency's belief that HCA will see a relatively stable regulatory and reimbursement environment over the next 12 to 18 months.