Financial Survey: Definitive Healthcare (NASDAQ:DH) and GoodRx (NASDAQ:GDRX)

Definitive Healthcare (NASDAQ:DH) and GoodRx (NASDAQ:GDRX) are both small-cap healthcare companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Volatility and Risk

Definitive Healthcare has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500. Comparatively, GoodRx has a beta of 1.69, meaning that its share price is 69% more volatile than the S&P 500.

Earnings & Valuation

This table compares Definitive Healthcare and GoodRx”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Definitive Healthcare	$232.70 million	0.45	-$138.93 million	($1.60)	-0.61
GoodRx	$796.85 million	1.47	$30.44 million	$0.04	85.75

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

Insider & Institutional Ownership

98.7% of Definitive Healthcare shares are held by institutional investors. Comparatively, 63.8% of GoodRx shares are held by institutional investors. 17.1% of Definitive Healthcare shares are held by company insiders. Comparatively, 5.9% of GoodRx shares are held 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 summary of recent ratings for Definitive Healthcare and GoodRx, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Definitive Healthcare	3	6	0	1	1.90
GoodRx	3	6	4	0	2.08

Definitive Healthcare presently has a consensus target price of $1.47, suggesting a potential upside of 50.15%. GoodRx has a consensus target price of $4.23, suggesting a potential upside of 23.24%. Given Definitive Healthcare’s higher possible upside, analysts plainly believe Definitive Healthcare is more favorable than GoodRx.

Profitability

This table compares Definitive Healthcare and GoodRx’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Definitive Healthcare	-72.28%	3.55%	1.63%
GoodRx	2.07%	7.22%	2.53%

Summary

GoodRx beats Definitive Healthcare on 11 of the 15 factors compared between the two stocks.

About Definitive Healthcare

Definitive Healthcare Corp., together with its subsidiaries, provides software as a service (SaaS) healthcare commercial intelligence platform in the United States and internationally. Its SaaS platform provides information on healthcare providers and their activities to help its customers from product development to go-to-market planning, and sales and marketing execution. The company's platform consists of various functional areas, such as sales, marketing, clinical research and product development, strategy, talent acquisition, and physician network management. It serves biopharmaceutical and medical device companies, healthcare information technology companies, and healthcare providers; and other diversified companies comprising staffing and commercial real estate firms, financial institutions, and other organizations in the healthcare ecosystem. Definitive Healthcare Corp. was founded in 2011 and is headquartered in Framingham, Massachusetts.

About GoodRx

GoodRx Holdings, Inc., together with its subsidiaries, offers information and tools that enable consumers to compare prices and save on their prescription drug purchases in the United States. The company operates a price comparison platform that provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices. It also offers other healthcare products and services, including subscriptions, and pharma manufacturer solutions, as well as telehealth services through the GoodRx Care platform. It serves pharmacy benefit managers who manage formularies and prescription transactions, including establishing pricing between consumers and pharmacies. The company was founded in 2011 and is headquartered in Santa Monica, California.