Alliance HealthCare Services (NASDAQ: AIQ) and ResMed (NYSE:RMD) are both healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.
Risk & Volatility
Alliance HealthCare Services has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500. Comparatively, ResMed has a beta of 0.77, indicating that its share price is 23% less volatile than the S&P 500.
ResMed pays an annual dividend of $1.40 per share and has a dividend yield of 1.8%. Alliance HealthCare Services does not pay a dividend. ResMed pays out 58.1% of its earnings in the form of a dividend.
Earnings & Valuation
This table compares Alliance HealthCare Services and ResMed’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Alliance HealthCare Services||N/A||N/A||N/A||($0.17)||-76.47|
|ResMed||$2.07 billion||5.31||$568.89 million||$2.41||32.05|
ResMed has higher revenue and earnings than Alliance HealthCare Services. Alliance HealthCare Services is trading at a lower price-to-earnings ratio than ResMed, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Alliance HealthCare Services and ResMed, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alliance HealthCare Services||0||0||0||0||N/A|
ResMed has a consensus price target of $64.80, indicating a potential downside of 16.12%. Given ResMed’s higher probable upside, analysts clearly believe ResMed is more favorable than Alliance HealthCare Services.
This table compares Alliance HealthCare Services and ResMed’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alliance HealthCare Services||3.63%||N/A||3.07%|
Institutional and Insider Ownership
27.0% of Alliance HealthCare Services shares are owned by institutional investors. Comparatively, 60.1% of ResMed shares are owned by institutional investors. 54.8% of Alliance HealthCare Services shares are owned by insiders. Comparatively, 1.8% of ResMed shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
ResMed beats Alliance HealthCare Services on 10 of the 12 factors compared between the two stocks.
About Alliance HealthCare Services
Alliance HealthCare Services, Inc. (Alliance) is a provider of outsourced healthcare services to hospitals and providers. The Company operates through three segments: Radiology Division, Oncology Division and Interventional Healthcare Services Division. The radiology segment comprises diagnostic imaging services, including magnetic resonance imaging (MRI), positron emission tomography/computed tomography (PET/CT) and other imaging services. The radiology segment also comprises radiation oncology services. The interventional healthcare services segment provides interventional healthcare through therapeutic minimally invasive pain management procedures medical management, laboratory testing and other services. The Company operates freestanding outpatient radiology, oncology and interventional clinics, and Ambulatory Surgical Centers (ASC) that are not owned by hospitals or providers. It operates over 560 diagnostic imaging and radiation therapy systems.
ResMed Inc. is a holding company. The Company is engaged in the development, manufacturing, distribution and marketing of medical devices and cloud-based software applications that diagnose, treat and manage respiratory disorders, including sleep disordered breathing (SDB), chronic obstructive pulmonary disease (COPD), neuromuscular disease and other diseases. SDB includes obstructive sleep apnea (OSA) and other respiratory disorders that occur during sleep. Its cloud-based software digital health applications, along with its devices, are designed to provide connected care to improve patient outcomes. The Company’s portfolio of products includes devices, diagnostic products, mask systems, headgear and other accessories, dental devices, portable oxygen concentrators (POCs) and cloud-based software informatics solutions. The Company produces Continuous Positive Airway Pressure (CPAP), Variable Positive Airway Pressure (VPAP) and AutoSet systems for the titration and treatment of SDB.
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