Head-To-Head Survey: Evolent Health (NYSE:EVH) & HealthEquity (HQY)

Evolent Health (NYSE: EVH) and HealthEquity (NASDAQ:HQY) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.

Risk and Volatility

Evolent Health has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500. Comparatively, HealthEquity has a beta of 1.75, suggesting that its stock price is 75% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Evolent Health and HealthEquity, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Evolent Health 0 0 11 1 3.08
HealthEquity 0 0 8 0 3.00

Evolent Health currently has a consensus price target of $30.33, indicating a potential upside of 75.85%. HealthEquity has a consensus price target of $57.00, indicating a potential upside of 26.33%. Given Evolent Health’s stronger consensus rating and higher possible upside, analysts clearly believe Evolent Health is more favorable than HealthEquity.

Institutional and Insider Ownership

82.5% of Evolent Health shares are owned by institutional investors. Comparatively, 91.9% of HealthEquity shares are owned by institutional investors. 8.8% of Evolent Health shares are owned by insiders. Comparatively, 29.0% of HealthEquity shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Evolent Health and HealthEquity’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Evolent Health -17.57% -6.44% -5.13%
HealthEquity 20.27% 13.93% 13.27%

Valuation and Earnings

This table compares Evolent Health and HealthEquity’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Evolent Health $361.53 million 3.14 -$51.15 million ($1.21) -14.26
HealthEquity $189.78 million 14.26 $57.61 million $0.67 67.34

HealthEquity has higher revenue, but lower earnings than Evolent Health. Evolent Health is trading at a lower price-to-earnings ratio than HealthEquity, indicating that it is currently the more affordable of the two stocks.

Summary

HealthEquity beats Evolent Health on 9 of the 14 factors compared between the two stocks.

Evolent Health Company Profile

Evolent Health, Inc. is engaged in healthcare delivery and payment. The Company supports health systems and physician organizations in their migration toward value-based care and population health management. The Company provides an end-to-end, technology-enabled services platform for providers. The Company’s platform, powered by its technology, processes and integrated services, enables providers to migrate their economic orientation from fee-for-service (FFS) reimbursement to payment models that reward value-based payment models. The Company’s services include providing its customers, with a population management platform, integrated data and analytics capabilities, pharmacy benefit management (PBM) services and comprehensive health plan administration services. Its value-based operations are empowered and supported by Identifi. Identifi is the Company’s technology platform that aggregates and analyzes data, manages care workflows and engages patients.

HealthEquity Company Profile

HealthEquity, Inc. provides a range of solutions for managing healthcare accounts (Health Savings Accounts (HSAs), Health Reimbursement Arrangements (HRAs) and Flexible Spending Accounts (FSAs)) for health plans, insurance companies and third-party administrators. The Company is engaged in technology-enabled services platforms that allow consumers to make healthcare saving and spending decisions. Its platform provides an ecosystem where consumers can access their tax-advantaged healthcare savings, compare treatment options and pricing, evaluate and pay healthcare bills, receive personalized benefit and clinical information, earn wellness incentives and make educated investment choices to help in their tax-advantaged healthcare savings. Its products and services include healthcare saving and spending platform, health savings accounts, investment advisory services, reimbursement arrangements and healthcare incentives. Its ecosystem primarily consists of HSA.

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