Analyzing Option Care Health (NASDAQ:OPCH) and The Pennant Group (NASDAQ:PNTG)

The Pennant Group (NASDAQ:PNTG) and Option Care Health (NASDAQ:OPCH) are both medical companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.

Earnings & Valuation

This table compares The Pennant Group and Option Care Health”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The Pennant Group	$695.24 million	1.25	$22.56 million	$0.78	32.36
Option Care Health	$5.00 billion	0.91	$211.82 million	$1.25	22.33

Option Care Health has higher revenue and earnings than The Pennant Group. Option Care Health is trading at a lower price-to-earnings ratio than The Pennant Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

The Pennant Group has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500. Comparatively, Option Care Health has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500.

Profitability

This table compares The Pennant Group and Option Care Health’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
The Pennant Group	3.36%	9.85%	4.04%
Option Care Health	3.93%	17.53%	7.17%

Institutional & Insider Ownership

85.9% of The Pennant Group shares are owned by institutional investors. Comparatively, 98.1% of Option Care Health shares are owned by institutional investors. 5.4% of The Pennant Group shares are owned by company insiders. Comparatively, 0.6% of Option Care Health shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for The Pennant Group and Option Care Health, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The Pennant Group	0	3	3	0	2.50
Option Care Health	0	4	9	0	2.69

The Pennant Group presently has a consensus price target of $32.80, indicating a potential upside of 29.95%. Option Care Health has a consensus price target of $35.10, indicating a potential upside of 25.76%. Given The Pennant Group’s higher probable upside, equities analysts clearly believe The Pennant Group is more favorable than Option Care Health.

Summary

Option Care Health beats The Pennant Group on 9 of the 14 factors compared between the two stocks.

About The Pennant Group

The Pennant Group, Inc. provides healthcare services in the United States. It operates in two segments, Home Health and Hospice Services, and Senior Living Services. The company offers home health services, including clinical services, such as nursing, speech, occupational and physical therapy, medical social work, and home health aide services; and hospice services comprising clinical care, education, and counseling services for the physical, spiritual, and psychosocial needs of terminally ill patients and their families. It also provides senior living services, such as residential accommodations, activities, meals, housekeeping, and assistance in the activities of daily living to seniors who are independent or who require some support. The company operates home health, hospice, and home care agencies, as well as senior living communities throughout Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin, and Wyoming. The Pennant Group, Inc. was incorporated in 2019 and is headquartered in Eagle, Idaho.

About Option Care Health

Option Care Health, Inc. offers home and alternate site infusion services in the United States. The company provides anti-infective therapies; home infusion services to treat heart failures; home parenteral nutrition and enteral nutrition support services for numerous acute and chronic conditions, such as stroke, cancer, and gastrointestinal diseases; immunoglobulin infusion therapies for the treatment of immune deficiencies; and treatments for chronic inflammatory disorders, including crohn’s disease, plaque psoriasis, psoriatic arthritis, rheumatoid arthritis, ulcerative colitis, and other chronic inflammatory disorders. It also offers treatments to manage the progression of neurological disorders, such as multiple sclerosis, duchenne muscular dystrophy, and other neurological disorder; infusion therapies for bleeding disorders, such as hemophilia and von Willebrand diseases; therapies for women with high-risk pregnancies; and other infusion therapies to treat various conditions, including pain management, chemotherapy, and respiratory medications, as well as nursing services. The company markets its services through patient referrals, including physicians, hospital discharge planners, hospital personnel, health maintenance organizations, and preferred provider organizations. Option Care Health, Inc. is headquartered in Bannockburn, Illinois.