Centene (NYSE:CNC – Get Free Report) and Addus HomeCare (NASDAQ:ADUS – Get Free Report) are both healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.
Institutional & Insider Ownership
93.6% of Centene shares are held by institutional investors. Comparatively, 95.3% of Addus HomeCare shares are held by institutional investors. 0.4% of Centene shares are held by company insiders. Comparatively, 4.1% of Addus HomeCare shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Centene and Addus HomeCare’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Centene | -2.51% | 12.12% | 3.20% |
| Addus HomeCare | 7.13% | 9.96% | 7.62% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Centene | 2 | 10 | 9 | 0 | 2.33 |
| Addus HomeCare | 1 | 4 | 5 | 1 | 2.55 |
Centene presently has a consensus price target of $70.05, suggesting a potential upside of 7.24%. Addus HomeCare has a consensus price target of $129.33, suggesting a potential upside of 13.12%. Given Addus HomeCare’s stronger consensus rating and higher possible upside, analysts clearly believe Addus HomeCare is more favorable than Centene.
Valuation & Earnings
This table compares Centene and Addus HomeCare”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Centene | $194.78 billion | 0.17 | -$6.67 billion | ($10.44) | -6.26 |
| Addus HomeCare | $1.42 billion | 1.50 | $95.91 million | $5.70 | 20.06 |
Addus HomeCare has lower revenue, but higher earnings than Centene. Centene is trading at a lower price-to-earnings ratio than Addus HomeCare, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Centene has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500. Comparatively, Addus HomeCare has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.
Summary
Addus HomeCare beats Centene on 11 of the 15 factors compared between the two stocks.
About Centene
Centene Corporation operates as a healthcare enterprise that provides programs and services to under-insured and uninsured families, commercial organizations, and military families in the United States. The company operates through Medicaid, Medicare, Commercial, and Other segments. The Medicaid segment offers health plan coverage, including medicaid expansion, aged, blind, disabled, children’s health insurance program, foster care, medicare-medicaid plans, long-term services and support. This segment also provides healthcare products. The Medicare segment offers special needs and medicare supplement, and prescription drug plans. The Commercial segment provides health insurance marketplace product for individual, small, and large group commercials. It also operates clinical healthcare and pharmacies, as well as offers dental and speech therapy services. In addition, the company engages in the government contracts business under the TRICARE program and other healthcare related government contracts. It provides services through primary and specialty care physicians, hospitals, and ancillary providers. Centene Corporation was founded in 1984 and is headquartered in Saint Louis, Missouri.
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.
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