Head-To-Head Contrast: Fresenius Medical Care AG & Co. (FMS) vs. Community Health Systems (CYH)

Community Health Systems (NYSE: CYH) and Fresenius Medical Care AG & Co. (NYSE:FMS) are both medical companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, risk, valuation, earnings, institutional ownership, analyst recommendations and profitability.

Profitability

This table compares Community Health Systems and Fresenius Medical Care AG & Co.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Community Health Systems -3.97% -3.10% -0.22%
Fresenius Medical Care AG & Co. 7.04% 11.51% 5.00%

Volatility and Risk

Community Health Systems has a beta of 1.52, meaning that its share price is 52% more volatile than the S&P 500. Comparatively, Fresenius Medical Care AG & Co. has a beta of 0.52, meaning that its share price is 48% less volatile than the S&P 500.

Insider and Institutional Ownership

94.7% of Community Health Systems shares are owned by institutional investors. Comparatively, 2.6% of Fresenius Medical Care AG & Co. shares are owned by institutional investors. 4.7% of Community Health Systems shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Community Health Systems and Fresenius Medical Care AG & Co.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Community Health Systems $18.44 billion 0.03 -$1.72 billion ($5.98) -0.92
Fresenius Medical Care AG & Co. $17.91 billion 1.80 $1.24 billion $2.49 21.16

Fresenius Medical Care AG & Co. has lower revenue, but higher earnings than Community Health Systems. Community Health Systems 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.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Community Health Systems and Fresenius Medical Care AG & Co., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Community Health Systems 6 9 0 0 1.60
Fresenius Medical Care AG & Co. 0 3 4 0 2.57

Community Health Systems currently has a consensus price target of $5.38, suggesting a potential downside of 2.10%. Fresenius Medical Care AG & Co. has a consensus price target of $53.00, suggesting a potential upside of 0.59%. Given Fresenius Medical Care AG & Co.’s stronger consensus rating and higher probable upside, analysts clearly believe Fresenius Medical Care AG & Co. is more favorable than Community Health Systems.

Dividends

Fresenius Medical Care AG & Co. pays an annual dividend of $0.37 per share and has a dividend yield of 0.7%. Community Health Systems does not pay a dividend. Fresenius Medical Care AG & Co. pays out 14.9% of its earnings in the form of a dividend. Community Health Systems has increased its dividend for 2 consecutive years.

Summary

Fresenius Medical Care AG & Co. beats Community Health Systems on 11 of the 17 factors compared between the two stocks.

About Community Health Systems

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.

About Fresenius Medical Care AG & Co.

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.

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