Contrasting Universal Health Services (UHS) and HealthStream (HSTM)
Universal Health Services (NYSE: UHS) and HealthStream (NASDAQ:HSTM) are both medical companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.
Volatility and Risk
Universal Health Services has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500. Comparatively, HealthStream has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.
Institutional & Insider Ownership
85.1% of Universal Health Services shares are held by institutional investors. Comparatively, 75.9% of HealthStream shares are held by institutional investors. 13.2% of Universal Health Services shares are held by company insiders. Comparatively, 21.1% of HealthStream shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This table compares Universal Health Services and HealthStream’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Universal Health Services||7.10%||15.49%||7.08%|
Earnings & Valuation
This table compares Universal Health Services and HealthStream’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Universal Health Services||$10.11 billion||1.05||$1.71 billion||$7.35||15.09|
|HealthStream||$238.45 million||3.13||$23.61 million||$0.14||166.93|
Universal Health Services has higher revenue and earnings than HealthStream. Universal Health Services is trading at a lower price-to-earnings ratio than HealthStream, indicating that it is currently the more affordable of the two stocks.
Universal Health Services pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. HealthStream does not pay a dividend. Universal Health Services pays out 5.4% of its earnings in the form of a dividend.
This is a summary of current recommendations and price targets for Universal Health Services and HealthStream, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Universal Health Services||0||7||7||0||2.50|
Universal Health Services presently has a consensus target price of $134.09, indicating a potential upside of 20.87%. HealthStream has a consensus target price of $25.17, indicating a potential upside of 7.69%. Given Universal Health Services’ higher probable upside, analysts plainly believe Universal Health Services is more favorable than HealthStream.
Universal Health Services beats HealthStream on 11 of the 15 factors compared between the two stocks.
About Universal Health Services
Universal Health Services, Inc. is a holding company. The Company’s principal business is owning and operating, through its subsidiaries, acute care hospitals and outpatient facilities, and behavioral healthcare facilities. The Company’s segments include Acute Care Hospital Services, Behavioral Health Services and Other. As of February 28, 2017, the Company owned and/or operated 319 inpatient facilities, and 33 outpatient and other facilities, located in 37 states, Washington, District of Columbia, the United Kingdom, Puerto Rico and the United States Virgin Islands. The Company’s hospitals provide a range of services, such as oncology, diagnostic care, coronary care, pediatric services, pharmacy services and/or behavioral health services. As of February 28, 2017, its acute care facilities located in the United States included 26 inpatient acute care hospitals; four free-standing emergency departments, and four outpatient surgery/cancer care centers and one surgical hospital.
HealthStream, Inc. (HealthStream) provides workforce, patient experience and provider solutions for healthcare organizations. The Company operates in three segments: HealthStream Workforce Solutions, HealthStream Patient Experience Solutions and HealthStream Provider Solutions. HealthStream’s products and services are organized into three segments: Workforce Solutions, Patient Experience Solutions, and Provider Solutions. HealthStream’s solutions are provided to a range of customers within the healthcare industry across the continuum of care. Delivered primarily as Software-as-a-Service (SaaS), the Company’s solutions focus on challenges facing the healthcare workforce and healthcare organizations, including the need to manage, retain, engage and develop healthcare workforce talent; meet compliance requirements; manage ongoing medical staff credentialing and privileging processes, and deliver patient experiences of care in healthcare organizations.
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