Financial Comparison: Hanger (HNGR) vs. AAC (AAC)

Hanger (OTCMKTS: HNGR) and AAC (NYSE:AAC) are both small-cap medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, valuation and risk.

Insider & Institutional Ownership

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3.4% of Hanger shares are held by institutional investors. Comparatively, 64.3% of AAC shares are held by institutional investors. 2.4% of Hanger shares are held by company insiders. Comparatively, 34.0% of AAC shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Hanger has a beta of 4.15, indicating that its stock price is 315% more volatile than the S&P 500. Comparatively, AAC has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for Hanger and AAC, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hanger 0 1 0 0 2.00
AAC 0 1 3 0 2.75

Hanger currently has a consensus price target of $17.00, suggesting a potential upside of 1.07%. AAC has a consensus price target of $10.00, suggesting a potential downside of 9.67%. Given Hanger’s higher probable upside, analysts clearly believe Hanger is more favorable than AAC.

Valuation & Earnings

This table compares Hanger and AAC’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hanger $1.04 billion 0.59 -$106.47 million $0.39 43.13
AAC $317.64 million 0.83 -$20.57 million $0.60 18.45

AAC has lower revenue, but higher earnings than Hanger. AAC is trading at a lower price-to-earnings ratio than Hanger, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Hanger and AAC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hanger N/A N/A N/A
AAC -6.48% 9.25% 3.38%

Summary

AAC beats Hanger on 9 of the 13 factors compared between the two stocks.

Hanger Company Profile

Hanger, Inc. provides orthotic and prosthetic (O&P) patient care services; and distributes O&P devices, manages O&P networks, and provides therapeutic solutions to patients and businesses in acute, post-acute, and clinic settings in the United States. It operates in two segments, Patient Care and Products & Services. The Patient Care segment owns and operates Hanger clinic, which specializes in the design, fabrication, and delivery of custom O&P devices through patient care clinics and satellite locations; and provides payor network contracting services to other O&P providers. The Products & Services segment procures and distributes O&P parts, componentry, and devices to independent O&P providers; and develops specialized rehabilitation technologies and provides evidence-based clinical programs for post-acute rehabilitation to patients at approximately 4,000 skilled nursing and post-acute providers. This segment also manufactures and sells therapeutic footwear for diabetic patients in the podiatric market. As of January 19, 2018, the company owned and operated approximately 800 patient care clinics in the United States. The company was formerly known as Hanger Orthopedic Group, Inc. and changed its name to Hanger, Inc. in June 2012. Hanger, Inc. was founded in 1861 and is headquartered in Austin, Texas.

AAC Company Profile

AAC Holdings, Inc. provides inpatient and outpatient substance use treatment services for individuals with drug addiction, alcohol addiction, and co-occurring mental/behavioral health issues in the United States. Its therapy services include motivational interviewing, cognitive behavioral therapy, rational emotive behavior therapy, dialectical behavioral therapy, solution-focused therapy, eye movement desensitization and reprocessing, and systematic family intervention. As of December 31, 2017, the company operated 9 residential substance abuse treatment facilities, 19 standalone outpatient centers, and 5 sober living facilities with a total of 1,348 combined residential and sober living beds. It also offers Internet marketing services to families and individuals struggling with addiction and seeking treatment options through online directories of treatment providers, treatment provider reviews, forums, and professional communities; and online marketing solutions to other treatment providers, such as facility profiles, audience targeting, lead generation, and tools for digital reputation management. In addition, the company performs drug testing and diagnostic laboratory services; and provides physician services to its clients. AAC Holdings, Inc. was founded in 2014 and is headquartered in Brentwood, Tennessee.

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