DaVita HealthCare Partners (NYSE: DVA) and Select Medical Holdings Corporation (NYSE:SEM) are both mid-cap medical companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Earnings and Valuation

This table compares DaVita HealthCare Partners and Select Medical Holdings Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
DaVita HealthCare Partners $15.01 billion 0.69 $2.45 billion $6.50 8.37
Select Medical Holdings Corporation $4.26 billion 0.56 $474.80 million $0.64 27.97

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

Insider & Institutional Ownership

83.3% of DaVita HealthCare Partners shares are held by institutional investors. Comparatively, 79.0% of Select Medical Holdings Corporation shares are held by institutional investors. 2.1% of DaVita HealthCare Partners shares are held by company insiders. Comparatively, 19.9% of Select Medical Holdings Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

Net Margins Return on Equity Return on Assets
DaVita HealthCare Partners 8.68% 14.02% 3.78%
Select Medical Holdings Corporation 1.95% 9.61% 1.84%

Risk & Volatility

DaVita HealthCare Partners has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500. Comparatively, Select Medical Holdings Corporation has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for DaVita HealthCare Partners and Select Medical Holdings Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DaVita HealthCare Partners 2 6 1 0 1.89
Select Medical Holdings Corporation 1 2 3 0 2.33

DaVita HealthCare Partners currently has a consensus price target of $66.50, suggesting a potential upside of 22.24%. Select Medical Holdings Corporation has a consensus price target of $18.80, suggesting a potential upside of 5.03%. Given DaVita HealthCare Partners’ higher probable upside, equities research analysts plainly believe DaVita HealthCare Partners is more favorable than Select Medical Holdings Corporation.

Summary

DaVita HealthCare Partners beats Select Medical Holdings Corporation on 9 of the 14 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 Select Medical Holdings Corporation

Select Medical Holdings Corporation is an operator of specialty hospitals, outpatient rehabilitation clinics and occupational medicine centers in the United States. The Company’s segments include specialty hospitals, outpatient rehabilitation, Concentra and Other. The specialty hospitals segment consists of hospitals designed to serve the needs of long term acute patients and hospitals designed to serve patients that require intensive medical rehabilitation care. The outpatient rehabilitation segment consists of clinics that provide physical, occupational, and speech rehabilitation services. The Concentra segment consists of medical centers and contract services provided at employer worksites and Department of Veterans Affairs community-based outpatient clinics (CBOCs) that deliver occupational medicine, physical therapy, veteran’s healthcare, and consumer health services. As of December 31, 2016, the Company had operations in 46 states and the District of Columbia.

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