HMS Holdings Corp

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HMSY : NASDAQ : Services
$18.81 | %
Today's Range: 18.51 - 18.89
Avg. Daily Volume: 605,800
07/22/16 - 4:00 PM ET

Financial Analysis


HMS HOLDINGS CORP's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. HMS HOLDINGS CORP is extremely liquid. Currently, the Quick Ratio is 4.74 which clearly shows the ability to cover any short-term cash needs. HMSY managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.15% 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 Q1 FY16 Q1 FY15
Net Sales ($mil)119.76110.32
EBITDA ($mil)21.5321.22
EBIT ($mil)9.917.98
Net Income ($mil)4.563.52


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)143.45133.55
Total Assets ($mil)841.02877.26
Total Debt ($mil)197.8197.8
Equity ($mil)531.88543.59


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin37.1237.33
EBITDA Margin17.9719.23
Operating Margin8.277.23
Sales Turnover0.580.51
Return on Assets3.031.6
Return on Equity4.82.59
Debt Q1 FY16 Q1 FY15
Current Ratio5.054.1
Debt/Capital0.270.27
Interest Expense2.091.95
Interest Coverage4.744.08


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)84.1388.51
Div / share0.00.0
EPS0.050.04
Book value / share6.326.14
Institutional Own % n/a n/a
Avg Daily Volume594753.0658045.0

Valuation


HOLD. The current P/E ratio indicates a significant discount compared to an average of 86.84 for the Health Care Technology industry and a significant premium compared to the S&P 500 average of 25.03. To use another comparison, its price-to-book ratio of 3.02 indicates valuation on par with the S&P 500 average of 2.80 and a significant discount versus the industry average of 5.75. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, HMS HOLDINGS CORP proves to trade at a discount 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
HMSY 65.83 Peers 86.84   HMSY 22.45 Peers 23.79

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

HMSY is trading at a discount to its peers.

 

Average. 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.

HMSY is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
HMSY 25.52 Peers 34.52   HMSY 0.51 Peers 1.12

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

HMSY is trading at a discount 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.

HMSY 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
HMSY 3.02 Peers 5.75   HMSY 81.25 Peers 58.94

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

HMSY is trading at a significant discount to its peers.

 

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

HMSY is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
HMSY 3.32 Peers 5.74   HMSY 7.75 Peers 36.32

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.

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

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

HMSY significantly trails its peers on the basis of sales growth

 

 

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