Financial Analysis: Surgical Care Affiliates (SCAI) vs. DaVita HealthCare Partners (DVA)
Surgical Care Affiliates (NASDAQ: SCAI) and DaVita HealthCare Partners (NYSE:DVA) are both healthcare companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, institutional ownership, earnings, profitability and risk.
This is a breakdown of current ratings and price targets for Surgical Care Affiliates and DaVita HealthCare Partners, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Surgical Care Affiliates||0||2||0||0||2.00|
|DaVita HealthCare Partners||2||6||1||0||1.89|
Surgical Care Affiliates presently has a consensus price target of $50.00, suggesting a potential downside of 10.51%. DaVita HealthCare Partners has a consensus price target of $65.00, suggesting a potential upside of 9.52%. Given DaVita HealthCare Partners’ higher possible upside, analysts clearly believe DaVita HealthCare Partners is more favorable than Surgical Care Affiliates.
This table compares Surgical Care Affiliates and DaVita HealthCare Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Surgical Care Affiliates||21.52%||13.07%||12.83%|
|DaVita HealthCare Partners||8.68%||14.02%||3.78%|
Risk & Volatility
Surgical Care Affiliates has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500. Comparatively, DaVita HealthCare Partners has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.
Valuation & Earnings
This table compares Surgical Care Affiliates and DaVita HealthCare Partners’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Surgical Care Affiliates||N/A||N/A||N/A||$0.55||101.58|
|DaVita HealthCare Partners||$15.01 billion||0.76||$2.45 billion||$6.50||9.13|
DaVita HealthCare Partners has higher revenue and earnings than Surgical Care Affiliates. DaVita HealthCare Partners is trading at a lower price-to-earnings ratio than Surgical Care Affiliates, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
83.2% of DaVita HealthCare Partners shares are owned by institutional investors. 3.3% of Surgical Care Affiliates shares are owned by company insiders. Comparatively, 2.1% of DaVita HealthCare Partners shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
DaVita HealthCare Partners beats Surgical Care Affiliates on 7 of the 11 factors compared between the two stocks.
Surgical Care Affiliates Company Profile
Surgical Care Affiliates, Inc. is a provider of solutions to physicians, health plans and health systems to optimize surgical care. The Company offers tools and systems in the areas of clinical benchmarking, clinical best practices, operating efficiency, care coordination and supply chain management. As of December 31, 2016, the Company operated a network of surgical facilities in the United States, which included 197 ambulatory surgery centers (ASCs) and seven surgical hospitals in partnership with approximately 3,000 physician partners. The Company’s operations consist of its ownership and management of ASCs and surgical hospitals. Its ASCs provide the facilities, equipment, supplies and clinical support staff necessary to provide non-emergency surgical services to patients not requiring hospitalization. Its surgical hospitals allow physicians to perform a range of surgical procedures, including surgeries, and allow patients to stay in the hospital for several nights to recover.
DaVita HealthCare Partners Company Profile
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.
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