DaVita HealthCare Partners (NYSE: DVA) and Fresenius Medical Care Corporation (NYSE:FMS) are both large-cap healthcare facilities & services – nec companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Earnings and Valuation

This table compares DaVita HealthCare Partners and Fresenius Medical Care Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
DaVita HealthCare Partners $14.75 billion 0.70 $879.87 million $2.61 21.04
Fresenius Medical Care Corporation $17.91 billion 1.68 $1.24 billion $2.40 20.35

Fresenius Medical Care Corporation has higher revenue and earnings than DaVita HealthCare Partners. Fresenius Medical Care Corporation is trading at a lower price-to-earnings ratio than DaVita HealthCare Partners, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares DaVita HealthCare Partners and Fresenius Medical Care Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DaVita HealthCare Partners 3.40% 13.31% 3.55%
Fresenius Medical Care Corporation 7.04% 11.51% 5.00%

Institutional & Insider Ownership

84.7% of DaVita HealthCare Partners shares are held by institutional investors. Comparatively, 2.6% of Fresenius Medical Care Corporation shares are held by institutional investors. 2.1% of DaVita HealthCare Partners shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

DaVita HealthCare Partners has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500. Comparatively, Fresenius Medical Care Corporation has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for DaVita HealthCare Partners and Fresenius Medical Care Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DaVita HealthCare Partners 2 6 1 0 1.89
Fresenius Medical Care Corporation 0 2 4 0 2.67

DaVita HealthCare Partners currently has a consensus target price of $63.00, suggesting a potential upside of 14.73%. Fresenius Medical Care Corporation has a consensus target price of $44.00, suggesting a potential downside of 9.89%. Given DaVita HealthCare Partners’ higher probable upside, equities research analysts plainly believe DaVita HealthCare Partners is more favorable than Fresenius Medical Care Corporation.

Dividends

Fresenius Medical Care Corporation pays an annual dividend of $0.37 per share and has a dividend yield of 0.8%. DaVita HealthCare Partners does not pay a dividend. Fresenius Medical Care Corporation pays out 15.4% of its earnings in the form of a dividend.

Summary

Fresenius Medical Care Corporation beats DaVita HealthCare Partners on 9 of the 16 factors compared between the two stocks.

About DaVita HealthCare Partners

DaVita Inc., formerly DaVita HealthCare Partners Inc., operates two divisions: DaVita Kidney Care (Kidney Care) and DaVita Medical Group (DMG). The Kidney Care division consists of its the United States dialysis and related lab services, its ancillary services and strategic initiatives, including its international operations, and its corporate administrative support. Its DMG division is a patient- and physician-focused integrated healthcare delivery and management company that provides medical services to members through capitation contracts. Its segments include U.S. dialysis and related lab services, DMG, and Other-Ancillary services and strategic initiatives. Its U.S. dialysis and related lab services line of business provide kidney dialysis services in the United States for patients suffering from chronic kidney failure, also known as end stage renal disease (ESRD). As of December 31, 2016, it had operated or provided administrative services to 154 outpatient dialysis centers.

About Fresenius Medical Care Corporation

Fresenius Medical Care AG & Co. KGaA is a kidney dialysis company. The Company provides dialysis care and related services to persons suffering from end-stage renal disease (ESRD), as well as other healthcare services. The Company’s segments include North America Segment, the Europe, Middle East and Africa (EMEA) Segment, the Asia-Pacific Segment and the Latin America Segment. The Company develops and manufactures a range of dialysis machines, systems and disposable products. As of December 31, 2016, the Company sold its products to customers in more than 120 countries and also used in its internal healthcare service operations. The Company’s Care Coordination services include coordinated delivery of pharmacy services, vascular, cardiovascular and endovascular specialty services, non-dialysis laboratory testing services, physician services, hospitalist and intensivist services, health plan services, ambulatory surgery center services and urgent care services.

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