Centene (NYSE: CNC) and Molina Healthcare (NYSE:MOH) are both mid-cap medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, profitability, dividends, earnings, valuation and institutional ownership.

Risk & Volatility

Centene has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500. Comparatively, Molina Healthcare has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500.

Institutional & Insider Ownership

92.3% of Centene shares are held by institutional investors. Comparatively, 96.2% of Molina Healthcare shares are held by institutional investors. 3.0% of Centene shares are held by insiders. Comparatively, 6.2% of Molina Healthcare shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Centene and Molina Healthcare’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Centene 1.81% 14.79% 4.34%
Molina Healthcare -1.76% 17.76% 3.40%

Analyst Ratings

This is a summary of recent ratings and target prices for Centene and Molina Healthcare, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Centene 1 4 13 0 2.67
Molina Healthcare 3 6 5 0 2.14

Centene presently has a consensus target price of $98.88, indicating a potential upside of 0.61%. Molina Healthcare has a consensus target price of $64.71, indicating a potential downside of 16.48%. Given Centene’s stronger consensus rating and higher possible upside, equities analysts plainly believe Centene is more favorable than Molina Healthcare.

Valuation & Earnings

This table compares Centene and Molina Healthcare’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Centene $40.61 billion 0.42 $562.00 million $4.88 20.14
Molina Healthcare $17.71 billion 0.25 $52.00 million ($5.27) -14.70

Centene has higher revenue and earnings than Molina Healthcare. Molina Healthcare is trading at a lower price-to-earnings ratio than Centene, indicating that it is currently the more affordable of the two stocks.

Summary

Centene beats Molina Healthcare on 9 of the 14 factors compared between the two stocks.

Centene Company Profile

Centene Corporation is a healthcare company. The Company provides a portfolio of services to government sponsored healthcare programs, focusing on under-insured and uninsured individuals. The Company operates through two segments: Managed Care and Specialty Services. The Company’s Managed Care segment provides health plan coverage to individuals, through government subsidized programs, including Medicaid, the State Children’s Health Insurance Program (CHIP), Long Term Care, Foster Care, dual-eligible individuals (Duals) and the Supplemental Security Income Program, also known as the Aged, Blind or Disabled Program (ABD), Medicare, and Health Insurance Marketplace. Its Specialty Services segment consists of its specialty companies offering a range of healthcare services and products to state programs, correctional facilities, healthcare organizations, employer groups and other commercial organizations, as well as to its own subsidiaries.

Molina Healthcare Company Profile

Molina Healthcare, Inc. offers Medicaid-related solutions for low-income families and individuals, and assists government agencies in their administration of the Medicaid program. The Company operates through three segments: Health Plans, Molina Medicaid Solutions and Other, which includes its Pathways Health and Community Support LLC (Pathways) business. It arranges healthcare services for persons served by Medicaid, Medicare, the Children’s Health Insurance Program (CHIP) and the Marketplace, and products to assist government agencies in their administration of the Medicaid program. As of December 31, 2016, the Company’s Health Plans segment consisted of health plans in 12 states and the Commonwealth of Puerto Rico, and its direct delivery business. The Molina Medicaid Solutions segment provides support to state government agencies in the administration of their Medicaid programs, including business processing, information technology development, and administrative services.

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