Tenet Healthcare's (THC) Q2 results topped expectations, with both its hospital and ambulatory surgery center segments outperforming as lower-than-expected labor and operating costs drove an adjusted EBITDA beat, UBS Securities said.

Results included an incremental benefit from supplemental payments, though the company did not specify how much of the $140 million increase in 2026 supplemental payment guidance was reflected in Q2 results versus the rest of the year, according to the note Thursday.

The company raised its 2026 adjusted EBITDA guidance by $295 million at the midpoint, with $285 million of the raise in the hospital segment and a $10 million increase at its subsidiary, United Surgical Partners International. The guidance raise also included $140 million in incremental Medicaid supplemental payments, the note added.

Tenet Healthcare is not seeing an increase in uninsured patients beyond what it expected from the exchanges, nor does it see any negative demand trends for surgical procedures, the brokerage said.

UBS has a buy rating on Tenet with a price target of $288.

Shares of Tenet Healthcare were up more than 16% in Friday trading.

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