Sector Snap: Hospital Operators

MedCath Corp. bought a stake in Southwest Arizona heart and Vascular Center LLC, a joint venture with a physician-owned company. MedCath, which is based in Charlotte, N.C., paid $8.5 million for a 27.4 percent share of the venture, and will assume management of the business.

The stock rose $1.24, or 6.6 percent, to $20.02 in afternoon trading.

Health Management Associates Inc. shares lost 10 cents to $5.75. The stock climbed 10.6 percent Tuesday after the company agreed to sell a stake in seven hospitals to Novant Health, for $300 million.

Psychiatric Solutions Inc. stock fell after an analyst said the company is unlikely to reach its growth targets in the first quarter.

Darren Lehrich of Deutsche Bank said the Franklin, Tenn., company is aiming for 7 to 9 percent growth at hospitals that have been open at least one year. But the company's patient admissions fall when schools are out of session, and because many spring breaks happened in the first quarter this year, comparisons will be difficult.

Easter vacations fell in April, or the second quarter, in 2007, but the holiday was in March in 2008.

Shares of the company, which operates facilities with about 10,000 beds in 31 states, Puerto Rico and U.S. Virgin Islands, fell $1.83, or 5.4 percent, to $31.95.

Elsewhere in the sector, shares of outpatient surgery center operator AmSurg Corp. fell 72 cents, or 3 percent, to $23.68. Lifepoint Hospitals Inc. stock rose 26 cents to $28.22.