Reviewing DaVita (NYSE:DVA) and Addus HomeCare (NASDAQ:ADUS)

DaVita (NYSE:DVA) and Addus HomeCare (NASDAQ:ADUS) are both medical companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Profitability

This table compares DaVita and Addus HomeCare’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DaVita	6.63%	176.11%	4.66%
Addus HomeCare	6.52%	9.23%	6.96%

Risk & Volatility

DaVita has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500. Comparatively, Addus HomeCare has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.

Institutional and Insider Ownership

90.1% of DaVita shares are owned by institutional investors. Comparatively, 95.4% of Addus HomeCare shares are owned by institutional investors. 2.0% of DaVita shares are owned by company insiders. Comparatively, 4.6% of Addus HomeCare shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for DaVita and Addus HomeCare, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DaVita	1	4	1	0	2.00
Addus HomeCare	0	0	6	2	3.25

DaVita currently has a consensus target price of $164.50, indicating a potential upside of 17.16%. Addus HomeCare has a consensus target price of $142.57, indicating a potential upside of 25.54%. Given Addus HomeCare’s stronger consensus rating and higher possible upside, analysts plainly believe Addus HomeCare is more favorable than DaVita.

Valuation and Earnings

This table compares DaVita and Addus HomeCare”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DaVita	$12.97 billion	0.82	$936.34 million	$10.09	13.92
Addus HomeCare	$1.15 billion	1.81	$73.60 million	$4.43	25.64

DaVita has higher revenue and earnings than Addus HomeCare. DaVita is trading at a lower price-to-earnings ratio than Addus HomeCare, indicating that it is currently the more affordable of the two stocks.

Summary

Addus HomeCare beats DaVita on 9 of the 15 factors compared between the two stocks.

About DaVita

DaVita Inc. provides kidney dialysis services for patients suffering from chronic kidney failure in the United States. The company operates kidney dialysis centers and provides related lab services in outpatient dialysis centers. It also offers outpatient, hospital inpatient, and home-based hemodialysis services; operates clinical laboratories that provide routine laboratory tests for dialysis and other physician-prescribed laboratory tests for ESRD patients; and management and administrative services to outpatient dialysis centers. In addition, the company offers integrated care and disease management services to patients in risk-based and other integrated care arrangements; clinical research programs; physician services; and comprehensive kidney care services. Further, it engages in the provision of acute inpatient dialysis services and related laboratory services; and transplant software business. The company was formerly known as DaVita HealthCare Partners Inc. and changed its name to DaVita Inc. in September 2016. DaVita Inc. was incorporated in 1994 and is headquartered in Denver, Colorado.

About Addus HomeCare

Addus HomeCare Corporation, together with its subsidiaries, provides personal care services to elderly, chronically ill, disabled persons, and individuals who are at risk of hospitalization or institutionalization in the United States. The company operates through three segments: Personal Care, Hospice, and Home Health. The Personal Care segment provides non-medical assistance with activities of daily living. This segment offers services that include assistance with bathing, grooming, oral care, feeding and dressing, medication reminders, meal planning and preparation, housekeeping, and transportation services. The Hospice segment provides palliative nursing care, social work, spiritual counseling, homemaker, and bereavement counseling services for people who are terminally ill, as well as related services for their families. The Home Health segment offers skilled nursing and physical, occupational, and speech therapy for the individuals who requires assistance during an illness or after hospitalization. The company's payor clients include federal, state, and local governmental agencies; managed care organizations; commercial insurers; and private individuals. Addus HomeCare Corporation was founded in 1979 and is headquartered in Frisco, Texas.