In July, Ardent Health Partners Inc. (NYSE:ARDT) closed its initial public offering of 12 million at a public offering price of $16 per share, for total gross proceeds of approximately $192 million.

Ardent Health Partners owns and operates a network of hospitals and clinics. It operates acute care hospitals, including rehabilitation hospitals and surgical hospitals.

Through its subsidiaries, Ardent Health delivers care through 30 acute care hospitals, more than 200 care sites, and over 1,700 providers across six states.

RBC Capital Markets has initiated coverage on Ardent Health Partners, citing a 'differentiated hospital platform with strong growth runway.'

The analyst initiates with an Outperform rating and a price target of $23.

RBC analyst says Ardent Health Partners' valuation and rating are based on its strong market position and clear growth potential.

Additionally, the company is poised for margin growth through supplemental Medicaid programs in key states and the efficiencies it has gained from its unique joint venture strategy.

Ardent's organic growth is bolstered by numerous expansion opportunities, particularly in outpatient services like ambulatory surgery. The company is currently underrepresented in ambulatory surgery centers (ASCs) within its markets.

Investing in outpatient facilities has proven successful for its public peers, including industry leader HCA Healthcare, Inc. (NYSE:HCA).

"Like HCA, Ardent holds a leading market position in its service areas, with a #1 or #2 market position in most of its markets. That said, we believe Ardent's markets likely comp more closely to those of Community Health Systems, Inc (NYSE:CYH), given Ardent's concentration in secondary MSAs," RBC Capital writes.

Truist Securities also initiated coverage on Ardent Health, "Well Positioned With Attractive Secular Tailwinds."

The analyst notes the company focuses on mid-size markets with attractive growth characteristics.

Truist analyst initiated coverage with a Buy rating and a price target of $21 and viewed the valuation risk/reward as attractive.

The analyst says Ardent's strong cash flow and financial flexibility are expected to support continued investment in its core business, expand its footprint, and pursue potential mergers and acquisitions in a fragmented market.

Price Action: ARDT stock is up 4.19% at $16.30 at the last check on Monday.

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