Genesis Healthcare (NYSE: GEN) and Five Star Senior Living (NYSE:FVE) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, valuation, dividends and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for Genesis Healthcare and Five Star Senior Living, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Genesis Healthcare 1 1 1 0 2.00
Five Star Senior Living 0 0 2 0 3.00

Genesis Healthcare presently has a consensus target price of $2.65, suggesting a potential upside of 132.46%. Five Star Senior Living has a consensus target price of $3.88, suggesting a potential upside of 150.00%. Given Five Star Senior Living’s stronger consensus rating and higher possible upside, analysts clearly believe Five Star Senior Living is more favorable than Genesis Healthcare.

Valuation and Earnings

This table compares Genesis Healthcare and Five Star Senior Living’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Genesis Healthcare $5.45 billion 0.02 $450.30 million N/A N/A
Five Star Senior Living $1.13 billion 0.07 $13.10 million ($0.84) -1.85

Genesis Healthcare has higher revenue and earnings than Five Star Senior Living.

Profitability

This table compares Genesis Healthcare and Five Star Senior Living’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Genesis Healthcare -2.05% -0.81% -0.96%
Five Star Senior Living -1.97% -16.89% -5.48%

Risk and Volatility

Genesis Healthcare has a beta of 1.15, meaning that its share price is 15% more volatile than the S&P 500. Comparatively, Five Star Senior Living has a beta of 1.78, meaning that its share price is 78% more volatile than the S&P 500.

Institutional and Insider Ownership

14.4% of Genesis Healthcare shares are held by institutional investors. 57.6% of Genesis Healthcare shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Genesis Healthcare Company Profile

Genesis Healthcare, Inc. is a holding company that provides post-acute care. The Company operates through three segments: inpatient services, which includes the operation of skilled nursing facilities and assisted or senior living facilities; rehabilitation therapy services, which includes its integrated and third-party rehabilitation and respiratory therapy services, and all other services. As of December 31, 2016, the Company offered inpatient services through its network of 499 skilled nursing and assisted/senior living facilities across 34 states, consisting of 473 skilled nursing facilities and 26 stand-alone assisted/senior living facilities. Its services focus primarily on the medical and physical issues facing elderly patients and are provided by its skilled nursing companies, assisted or senior living communities, integrated and third-party rehabilitation therapy business, and other ancillary services.

Five Star Senior Living Company Profile

Five Star Senior Living Inc., formerly Five Star Quality Care, Inc., operates senior living communities, including independent living communities, assisted living communities and skilled nursing facilities (SNFs). The Company’s segments include senior living communities and rehabilitation and wellness. In the senior living communities segment, the Company operates for its own account or manage for the account of others independent living communities, assisted living communities and SNFs that are subject to centralized oversight and provide housing and services to elderly residents. In the rehabilitation and wellness segment, the Company provides services in the inpatient setting and in outpatient clinics. As of December 31, 2016, the Company operated 283 senior living communities located in 32 states with 31,830 living units, including 253 primarily independent and assisted living communities with 29,229 living units and 30 SNFs with 2,601 living units.

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