American Renal Associates (NYSE: ARA) and Streamline Health Solutions (NASDAQ:STRM) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.
This table compares American Renal Associates and Streamline Health Solutions’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|American Renal Associates||-2.15%||15.80%||2.34%|
|Streamline Health Solutions||-16.88%||-40.97%||-10.96%|
91.4% of American Renal Associates shares are owned by institutional investors. Comparatively, 37.2% of Streamline Health Solutions shares are owned by institutional investors. 12.6% of American Renal Associates shares are owned by company insiders. Comparatively, 26.1% of Streamline Health Solutions shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for American Renal Associates and Streamline Health Solutions, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|American Renal Associates||0||0||4||0||3.00|
|Streamline Health Solutions||0||0||0||0||N/A|
American Renal Associates presently has a consensus price target of $20.00, suggesting a potential upside of 1.11%. Given American Renal Associates’ higher probable upside, equities research analysts clearly believe American Renal Associates is more favorable than Streamline Health Solutions.
Valuation & Earnings
This table compares American Renal Associates and Streamline Health Solutions’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|American Renal Associates||$749.77 million||0.83||-$380,000.00||($0.09)||-219.78|
|Streamline Health Solutions||$27.06 million||1.39||-$5.16 million||($0.21)||-8.95|
American Renal Associates has higher revenue and earnings than Streamline Health Solutions. American Renal Associates is trading at a lower price-to-earnings ratio than Streamline Health Solutions, indicating that it is currently the more affordable of the two stocks.
American Renal Associates beats Streamline Health Solutions on 9 of the 12 factors compared between the two stocks.
American Renal Associates Company Profile
American Renal Associates Holdings, Inc. is a dialysis service provider in the United States focused on joint venture (JV) partnerships with physicians. As of December 31, 2016, the Company owned and operated 214 dialysis clinics in partnership with 379 nephrologist partners treating over 14,000 patients in 25 states and the District of Columbia. The Company operates its dialysis clinics exclusively through a JV model, in which it partners primarily with local nephrologists to develop, own and operate dialysis clinics, while the providers of the majority of dialysis services in the United States operate through a combination of subsidiaries and joint ventures. It provides patient care and clinical outcomes to patients suffering from end-stage renal disease (ESRD). Its clinics offer both in center and home dialysis options to meet the needs of patients. Its clinics primarily provide in center hemodialysis treatments and ancillary items and services.
Streamline Health Solutions Company Profile
Streamline Health Solutions, Inc. is engaged in providing healthcare information technology through the licensing of its Electronic Health Information Management, Patient Financial, Coding and Clinical Documentation Improvement (CDI), and other Workflow software applications, and the use of such applications by software as a service. The Company also provides implementation and consulting services to complement its software solutions. The Company provides computer software-based solutions through its Looking Glass platform. The Company sells its solutions and services in North America to hospitals and health systems, including physician practices, through its direct sales force and its reseller partnerships. The Company’s software and services allow hospitals and integrated healthcare delivery systems in the United States and Canada to capture, store, manage, route, retrieve and process patient clinical, financial and other healthcare provider information.
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