Head-To-Head Contrast: Healthcare Services Group (NASDAQ:HCSG) versus SGS (OTCMKTS:SGSOY)

SGS (OTCMKTS:SGSOY) and Healthcare Services Group (NASDAQ:HCSG) are both business services companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitability.

Valuation & Earnings

This table compares SGS and Healthcare Services Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SGS	$7.72 billion	3.09	$659.96 million	N/A	N/A
Healthcare Services Group	$1.81 billion	0.76	$39.47 million	$0.54	36.07

SGS has higher revenue and earnings than Healthcare Services Group.

Analyst Ratings

This is a breakdown of recent ratings and target prices for SGS and Healthcare Services Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SGS	1	2	1	3	2.86
Healthcare Services Group	0	4	3	0	2.43

Healthcare Services Group has a consensus price target of $19.40, indicating a potential downside of 0.41%. Given Healthcare Services Group’s higher possible upside, analysts clearly believe Healthcare Services Group is more favorable than SGS.

Volatility and Risk

SGS has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500. Comparatively, Healthcare Services Group has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500.

Insider and Institutional Ownership

98.0% of Healthcare Services Group shares are held by institutional investors. 2.6% of Healthcare Services Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares SGS and Healthcare Services Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SGS	N/A	N/A	N/A
Healthcare Services Group	2.20%	12.23%	7.52%

Dividends

SGS pays an annual dividend of $0.18 per share and has a dividend yield of 1.5%. Healthcare Services Group pays an annual dividend of $0.86 per share and has a dividend yield of 4.4%. Healthcare Services Group pays out 159.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Healthcare Services Group beats SGS on 8 of the 14 factors compared between the two stocks.

About SGS

SGS SA provides inspection, testing, and verification services in Europe, Africa, the Middle East, the Americas, and the Asia Pacific. It operates in five segments: Connectivity & Products, Health & Nutrition, Industries & Environment, Natural Resources, and Business Assurance. The company provides laboratory testing, product inspection and consulting, process assessment, technical and transactional assistance; and automotive, connectivity, softlines and accessories, and hardgoods, toys, and juvenile products, as well as government and trade facilitation services. In addition, it offers a range of testing, inspection and certification solutions for the crop science, food, health science, and cosmetics and hygiene industries; field services, technical assessment, and advisory services; and services related to industrial, public health and safety, environmental testing, and public mandates. Further, it provides assessment, auditing, and certification, supply chain assurance, training, consulting, and sustainability assurance services; agricultural commodities, geochemistry, laboratory testing petroleum and chemicals, metallurgy and consulting, mineral and metal commodities, and oil, gas, and chemical commodities; and sustainability solutions. The company serves the agriculture and food, chemical, construction, consumer and retail, energy, industrial manufacturing, life sciences, mining, oil and gas, public, and transportation sectors. SGS SA was founded in 1878 and is headquartered in Geneva, Switzerland.

About Healthcare Services Group

Healthcare Services Group, Inc. provides management, administrative, and operating services to the housekeeping, laundry, linen, facility maintenance, and dietary service departments of nursing homes, retirement complexes, rehabilitation centers, and hospitals in the United States. It operates through two segments, Housekeeping and Dietary. The Housekeeping segment engages in the cleaning, disinfecting, and sanitizing of resident rooms and common areas of the customers' facilities, as well as laundering and processing of the bed linens, uniforms, resident personal clothing, and other assorted linen items utilized at the customers' facilities. The Dietary segment provides food purchasing, meal preparation, and professional dietitian services, which include the development of menus that meet the dietary needs of residents; and on-site management and clinical consulting services to facilities. It serves long-term and post-acute care facilities, hospitals, and the healthcare industry through referrals and solicitation of target facilities. The company was incorporated in 1976 and is based in Bensalem, Pennsylvania.