HCA Holdings Inc.
Thesis
HCA is significantly undervalued, trading at approximately 8.5x EBITDA compared to healthcare REITs that trade between 16x and 25x EBITDA. By spinning off its real estate into a PropCo, HCA shareholders could unlock hidden value. The stock has a potential upside of ~75% over the next three years, translating to a 21% IRR, with a favorable risk-reward ratio.
Did it work?
The long thesis decisively played out: HCA returned +427.3% since the pitch, far exceeding the stated ~75% three-year upside target, and the ~11-year elapsed period gives ample time for the thesis to be judged. The core claim of significant undervaluation at 8.5x EBITDA was validated as the market re-rated the stock dramatically, confirming the value-unlock thesis regardless of whether the specific PropCo spin-off mechanism occurred.