LifePoint Health (NASDAQ: LPNT) and Community Health Systems (NYSE:CYH) are both small-cap healthcare companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, profitability, dividends, earnings, institutional ownership and risk.

Earnings & Valuation

This table compares LifePoint Health and Community Health Systems’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LifePoint Health $7.27 billion 0.26 $121.90 million $4.22 11.46
Community Health Systems $18.44 billion 0.03 -$1.72 billion ($5.82) -0.85

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

Institutional and Insider Ownership

99.2% of LifePoint Health shares are owned by institutional investors. Comparatively, 94.7% of Community Health Systems shares are owned by institutional investors. 8.8% of LifePoint Health shares are owned by company insiders. Comparatively, 4.7% of Community Health Systems shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for LifePoint Health and Community Health Systems, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LifePoint Health 1 11 5 0 2.24
Community Health Systems 5 9 0 0 1.64

LifePoint Health presently has a consensus target price of $58.08, indicating a potential upside of 20.12%. Community Health Systems has a consensus target price of $5.46, indicating a potential upside of 9.83%. Given LifePoint Health’s stronger consensus rating and higher probable upside, equities research analysts plainly believe LifePoint Health is more favorable than Community Health Systems.

Profitability

This table compares LifePoint Health and Community Health Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LifePoint Health 2.45% 7.01% 2.53%
Community Health Systems -3.97% -3.10% -0.22%

Volatility & Risk

LifePoint Health has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500. Comparatively, Community Health Systems has a beta of 1.42, suggesting that its stock price is 42% more volatile than the S&P 500.

Summary

LifePoint Health beats Community Health Systems on 12 of the 14 factors compared between the two stocks.

LifePoint Health Company Profile

LifePoint Health, Inc., through its subsidiaries, owns and operates community hospitals, regional health systems, physician practices, outpatient centers and post-acute facilities. As of December 31, 2016, the Company operated 72 hospital campuses in 22 states, having a total of 9,424 licensed beds. It offers a range of general and specialized healthcare services to patients through a network of hospitals and outpatient facilities. Its services include general surgery, internal medicine, obstetrics, emergency room care, radiology, oncology, diagnostic care, coronary care, rehabilitation services and pediatric services, and in some of its hospitals, the Company offers specialized services, such as open-heart surgery, skilled nursing, psychiatric care and neuro-surgery. It provides outpatient services, such as same-day surgery, laboratory, x-ray, respiratory therapy, imaging, sports medicine and lithotripsy.

Community Health Systems Company Profile

Community Health Systems, Inc. is an operator of general acute care hospitals and outpatient facilities in communities across the country. The Company operates through hospital operations segment, which includes its general acute care hospitals and related healthcare entities that provide inpatient and outpatient healthcare services. The Company provides healthcare services through the hospitals that it owns and operates and affiliated businesses in non-urban and selected urban markets throughout the United States. The services provided through its hospitals and affiliated businesses include general acute care, emergency room, general and specialty surgery, critical care, internal medicine, obstetrics, diagnostic, psychiatric and rehabilitation services. The Company also provides additional outpatient services at urgent care centers, occupational medicine clinics, imaging centers, cancer centers, ambulatory surgery centers, and home health and hospice agencies.

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