Kindred Healthcare (NYSE: KND) and HCA Holdings (NYSE:HCA) are both medical companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, valuation, risk, institutional ownership, analyst recommendations, earnings and profitability.
Institutional & Insider Ownership
88.9% of Kindred Healthcare shares are owned by institutional investors. Comparatively, 74.5% of HCA Holdings shares are owned by institutional investors. 3.0% of Kindred Healthcare shares are owned by company insiders. Comparatively, 2.9% of HCA Holdings shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This table compares Kindred Healthcare and HCA Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares Kindred Healthcare and HCA Holdings’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Kindred Healthcare||$7.08 billion||0.09||$473.57 million||($12.82)||-0.57|
|HCA Holdings||$42.27 billion||0.69||$8.20 billion||$7.47||10.63|
HCA Holdings has higher revenue and earnings than Kindred Healthcare. Kindred Healthcare is trading at a lower price-to-earnings ratio than HCA Holdings, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings for Kindred Healthcare and HCA Holdings, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Kindred Healthcare currently has a consensus price target of $9.67, suggesting a potential upside of 31.52%. HCA Holdings has a consensus price target of $93.27, suggesting a potential upside of 17.51%. Given Kindred Healthcare’s higher possible upside, analysts clearly believe Kindred Healthcare is more favorable than HCA Holdings.
Kindred Healthcare pays an annual dividend of $0.36 per share and has a dividend yield of 4.9%. HCA Holdings does not pay a dividend. Kindred Healthcare pays out -2.8% of its earnings in the form of a dividend.
Volatility and Risk
Kindred Healthcare has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500. Comparatively, HCA Holdings has a beta of 0.67, indicating that its share price is 33% less volatile than the S&P 500.
Kindred Healthcare Company Profile
Kindred Healthcare, Inc. is a healthcare services company. The Company, through its subsidiaries, operates transitional care (TC) hospitals, a home health, hospice and community care business, inpatient rehabilitation hospitals (IRFs), a contract rehabilitation services business, nursing centers and assisted living facilities across the United States. The Company operates through four divisions: the Kindred at Home division, the hospital division, the Kindred Rehabilitation Services division and the nursing center division. These divisions represent six segments: home health services, hospice services, hospitals, Kindred Hospital Rehabilitation Services, RehabCare and nursing centers. The home health services and hospice services operating segments are contained within the Kindred at Home division while the Kindred Hospital Rehabilitation Services and RehabCare operating segments are both contained within the Kindred Rehabilitation Services division.
HCA Holdings Company Profile
HCA Healthcare, Inc., formerly HCA Holdings, Inc., is a holding company. The Company, through its subsidiaries, owns and operates hospitals and related healthcare entities. As of December 31, 2016, the Company operated in two geographically organized groups, including the National and American Groups. As of December 31, 2016, the National Group included 84 hospitals, which were located in Alaska, California, Florida, southern Georgia, Idaho, Indiana, northern Kentucky, Nevada, New Hampshire, South Carolina, Utah and Virginia. As of December 31, 2016, the American Group included 80 hospitals, which were located in Colorado, northern Georgia, Kansas, southern Kentucky, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas. As of December 31, 2016, the Company operated six hospitals in England. The Company owns, manages or operates hospitals, freestanding surgery centers and freestanding emergency care facilities, walk-in clinics, diagnostic and imaging centers, among others.
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