Fresenius Medical Care AG & Co. (NYSE: FMS) and Universal Health Services (NYSE:UHS) are both large-cap medical companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, earnings, institutional ownership and dividends.
Risk & Volatility
Fresenius Medical Care AG & Co. has a beta of 0.52, suggesting that its stock price is 48% less volatile than the S&P 500. Comparatively, Universal Health Services has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500.
Fresenius Medical Care AG & Co. pays an annual dividend of $0.37 per share and has a dividend yield of 0.7%. Universal Health Services pays an annual dividend of $0.40 per share and has a dividend yield of 0.3%. Fresenius Medical Care AG & Co. pays out 16.6% of its earnings in the form of a dividend. Universal Health Services pays out 5.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Universal Health Services has increased its dividend for 2 consecutive years.
This table compares Fresenius Medical Care AG & Co. and Universal Health Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Fresenius Medical Care AG & Co.||7.04%||11.51%||5.00%|
|Universal Health Services||6.90%||15.13%||6.92%|
Valuation & Earnings
This table compares Fresenius Medical Care AG & Co. and Universal Health Services’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Fresenius Medical Care AG & Co.||$17.91 billion||1.78||$1.24 billion||$2.23||23.34|
|Universal Health Services||$9.77 billion||1.12||$702.40 million||$7.28||15.84|
Fresenius Medical Care AG & Co. has higher revenue and earnings than Universal Health Services. Universal Health Services is trading at a lower price-to-earnings ratio than Fresenius Medical Care AG & Co., indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and recommmendations for Fresenius Medical Care AG & Co. and Universal Health Services, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Fresenius Medical Care AG & Co.||0||3||4||0||2.57|
|Universal Health Services||0||3||12||0||2.80|
Fresenius Medical Care AG & Co. currently has a consensus price target of $53.00, suggesting a potential upside of 1.83%. Universal Health Services has a consensus price target of $130.93, suggesting a potential upside of 13.57%. Given Universal Health Services’ stronger consensus rating and higher possible upside, analysts plainly believe Universal Health Services is more favorable than Fresenius Medical Care AG & Co..
Institutional & Insider Ownership
2.6% of Fresenius Medical Care AG & Co. shares are owned by institutional investors. Comparatively, 85.8% of Universal Health Services shares are owned by institutional investors. 13.2% of Universal Health Services shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Universal Health Services beats Fresenius Medical Care AG & Co. on 11 of the 17 factors compared between the two stocks.
Fresenius Medical Care AG & Co. Company Profile
Fresenius Medical Care AG & Co. KGaA is a kidney dialysis company. The Company provides dialysis care and related services to persons suffering from end-stage renal disease (ESRD), as well as other healthcare services. The Company’s segments include North America Segment, the Europe, Middle East and Africa (EMEA) Segment, the Asia-Pacific Segment and the Latin America Segment. The Company develops and manufactures a range of dialysis machines, systems and disposable products. As of December 31, 2016, the Company sold its products to customers in more than 120 countries and also used in its internal healthcare service operations. The Company’s Care Coordination services include coordinated delivery of pharmacy services, vascular, cardiovascular and endovascular specialty services, non-dialysis laboratory testing services, physician services, hospitalist and intensivist services, health plan services, ambulatory surgery center services and urgent care services.
Universal Health Services Company Profile
Universal Health Services, Inc. is a holding company. The Company’s principal business is owning and operating, through its subsidiaries, acute care hospitals and outpatient facilities, and behavioral healthcare facilities. The Company’s segments include Acute Care Hospital Services, Behavioral Health Services and Other. As of February 28, 2017, the Company owned and/or operated 319 inpatient facilities, and 33 outpatient and other facilities, located in 37 states, Washington, District of Columbia, the United Kingdom, Puerto Rico and the United States Virgin Islands. The Company’s hospitals provide a range of services, such as oncology, diagnostic care, coronary care, pediatric services, pharmacy services and/or behavioral health services. As of February 28, 2017, its acute care facilities located in the United States included 26 inpatient acute care hospitals; four free-standing emergency departments, and four outpatient surgery/cancer care centers and one surgical hospital.
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