Acadia Healthcare (ACHC) and Laboratory Corporation of America Holdings (LH) Financial Survey

Acadia Healthcare (NASDAQ: ACHC) and Laboratory Corporation of America Holdings (NYSE:LH) are both mid-cap medical companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.

Volatility and Risk

Acadia Healthcare has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500. Comparatively, Laboratory Corporation of America Holdings has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Acadia Healthcare and Laboratory Corporation of America Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Acadia Healthcare 0 4 9 1 2.79
Laboratory Corporation of America Holdings 0 5 7 0 2.58

Acadia Healthcare currently has a consensus price target of $48.42, indicating a potential upside of 49.34%. Laboratory Corporation of America Holdings has a consensus price target of $170.36, indicating a potential upside of 11.07%. Given Acadia Healthcare’s stronger consensus rating and higher possible upside, research analysts plainly believe Acadia Healthcare is more favorable than Laboratory Corporation of America Holdings.

Valuation and Earnings

This table compares Acadia Healthcare and Laboratory Corporation of America Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Acadia Healthcare $2.83 billion 1.01 $574.61 million $0.09 360.22
Laboratory Corporation of America Holdings $9.67 billion 1.61 $1.86 billion $7.12 21.54

Laboratory Corporation of America Holdings has higher revenue and earnings than Acadia Healthcare. Laboratory Corporation of America Holdings is trading at a lower price-to-earnings ratio than Acadia Healthcare, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Acadia Healthcare and Laboratory Corporation of America Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Acadia Healthcare 0.30% 8.69% 3.16%
Laboratory Corporation of America Holdings 7.57% 16.85% 6.55%

Insider & Institutional Ownership

93.2% of Laboratory Corporation of America Holdings shares are held by institutional investors. 11.1% of Acadia Healthcare shares are held by company insiders. Comparatively, 0.9% of Laboratory Corporation of America Holdings shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Laboratory Corporation of America Holdings beats Acadia Healthcare on 8 of the 15 factors compared between the two stocks.

Acadia Healthcare Company Profile

Acadia Healthcare Company, Inc. is a provider of behavioral healthcare services, with operations in the United States and the United Kingdom. The Company focuses on acquiring and developing behavioral healthcare facilities. The Company operates through two segments: U.S. Facilities and U.K. Facilities. The Company is engaged in operating acute inpatient psychiatric facilities, specialty treatment facilities, residential treatment centers and facilities providing outpatient behavioral healthcare services. As of December 31, 2016, the U.S. Facilities segment included 208 behavioral healthcare facilities with approximately 8,500 beds in 39 states and Puerto Rico, and the U.K. Facilities segment included 365 behavioral healthcare facilities with approximately 8,600 beds in the United Kingdom. As of December 31, 2016, the Company had operated 573 behavioral healthcare facilities with approximately 17,100 beds in 39 states, the United Kingdom and Puerto Rico.

Laboratory Corporation of America Holdings Company Profile

Laboratory Corporation of America Holdings is a life sciences company that is integrated in guiding patient care, providing clinical laboratory and end-to-end drug development services. The Company operates as a healthcare diagnostics company. The Company operates through two segments: LabCorp Diagnostics (LCD) and Covance Drug Development (CDD). The LCD segment is an independent clinical laboratory business, which offers menu of frequently requested and specialty testing through an integrated network of primary and specialty laboratories across the United States. The CDD segment offers drug development services, and provides a range of drug research and development (R&D) and market access services to biopharmaceutical companies and medical device companies across the world. It serves a range of customers, including managed care organizations (MCOs), biopharmaceutical companies, governmental agencies, physicians and other healthcare providers.

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