Critical Survey: Chemed (CHE) and The Competition

Chemed (NYSE:CHE) is one of 235 public companies in the “Healthcare Providers & Services” industry, but how does it compare to its competitors? We will compare Chemed to related businesses based on the strength of its analyst recommendations, valuation, dividends, earnings, risk, profitability and institutional ownership.

Institutional and Insider Ownership

95.8% of Chemed shares are owned by institutional investors. Comparatively, 56.9% of shares of all “Healthcare Providers & Services” companies are owned by institutional investors. 3.3% of Chemed shares are owned by company insiders. Comparatively, 15.4% of shares of all “Healthcare Providers & Services” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Chemed and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Chemed	$2.53 billion	$265.24 million	25.87
Chemed Competitors	$20.60 billion	$281.76 million	-2.39

Chemed’s competitors have higher revenue and earnings than Chemed. Chemed is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Chemed pays an annual dividend of $2.80 per share and has a dividend yield of 0.5%. Chemed pays out 14.1% of its earnings in the form of a dividend. As a group, “Healthcare Providers & Services” companies pay a dividend yield of 1.6% and pay out 25.4% of their earnings in the form of a dividend. Chemed has raised its dividend for 16 consecutive years.

Risk and Volatility

Chemed has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500. Comparatively, Chemed’s competitors have a beta of 0.98, meaning that their average stock price is 2% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Chemed and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chemed	0	5	1	0	2.17
Chemed Competitors	1798	7563	12998	790	2.55

Chemed currently has a consensus target price of $530.75, indicating a potential upside of 3.02%. As a group, “Healthcare Providers & Services” companies have a potential upside of 14.74%. Given Chemed’s competitors stronger consensus rating and higher probable upside, analysts clearly believe Chemed has less favorable growth aspects than its competitors.

Profitability

This table compares Chemed and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chemed	10.60%	31.77%	18.90%
Chemed Competitors	-7.68%	-139.71%	-1.48%

Summary

Chemed competitors beat Chemed on 9 of the 15 factors compared.

About Chemed

Chemed Corporation provides hospice and palliative care services to patients through a network of physicians, registered nurses, home health aides, social workers, clergy, and volunteers primarily in the United States. The company operates in VITAS and Roto-Rooter segments. It offers plumbing, drain cleaning, excavation, water restoration, and other related services to residential and commercial customers through company-owned branches, independent contractors, and franchisees. The company was incorporated in 1970 and is headquartered in Cincinnati, Ohio.