Healthcare Services Group Inc

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HCSG : NASDAQ : Services
$40.68 | %
Today's Range: 40.29 - 40.72
Avg. Daily Volume: 420200.0
12/09/16 - 4:00 PM ET

Financial Analysis


HEALTHCARE SERVICES GROUP's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. HEALTHCARE SERVICES GROUP is extremely liquid. Currently, the Quick Ratio is 3.20 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 11.43% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)392.73360.17
EBITDA ($mil)30.9329.92
EBIT ($mil)29.2128.08
Net Income ($mil)19.7117.09


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)104.95103.57
Total Assets ($mil)536.82474.8
Total Debt ($mil)0.00.0
Equity ($mil)331.1297.12


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin14.814.82
EBITDA Margin7.878.3
Operating Margin7.447.8
Sales Turnover2.852.97
Return on Assets12.3313.55
Return on Equity20.021.66
Debt Q3 FY16 Q3 FY15
Current Ratio3.673.9
Debt/Capital0.00.0
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)72.5171.93
Div / share0.180.18
EPS0.270.24
Book value / share4.574.13
Institutional Own % n/a n/a
Avg Daily Volume501194.0338762.0

Valuation


BUY. HEALTHCARE SERVICES GROUP's P/E ratio indicates a significant premium compared to an average of 31.96 for the Commercial Services & Supplies industry and a significant premium compared to the S&P 500 average of 25.37. For additional comparison, its price-to-book ratio of 8.50 indicates a significant premium versus the S&P 500 average of 2.81 and a significant premium versus the industry average of 4.75. The price-to-sales ratio is below the S&P 500 average and is well below the industry average, indicating a discount. After reviewing these and other key valuation criteria, HEALTHCARE SERVICES GROUP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
HCSG 42.20 Peers 31.96   HCSG 57.74 Peers 15.74

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

HCSG is trading at a significant premium to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

HCSG is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
HCSG 31.82 Peers 26.35   HCSG 1.30 Peers 2.97

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

HCSG is trading at a significant premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

HCSG trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
HCSG 8.50 Peers 4.75   HCSG 1.09 Peers 62.44

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

HCSG is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, HCSG is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
HCSG 1.84 Peers 2.36   HCSG 8.33 Peers 7.38

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

HCSG is trading at a discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

HCSG has a sales growth rate that exceeds its peers.

 

 

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