National HealthCare (NYSE:NHC) and Diversicare Healthcare Services (OTCMKTS:DVCR) are both small-cap medical companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, valuation, profitability, institutional ownership, analyst recommendations, risk and dividends.
Insider & Institutional Ownership
46.8% of National HealthCare shares are held by institutional investors. 13.1% of National HealthCare shares are held by insiders. Comparatively, 35.1% of Diversicare Healthcare Services shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares National HealthCare and Diversicare Healthcare Services’ gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| National HealthCare | $996.38 million | 0.96 | $68.21 million | N/A | N/A |
| Diversicare Healthcare Services | $475.02 million | 0.02 | -$36.06 million | N/A | N/A |
National HealthCare has higher revenue and earnings than Diversicare Healthcare Services.
Profitability
This table compares National HealthCare and Diversicare Healthcare Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| National HealthCare | 3.41% | 7.76% | 4.59% |
| Diversicare Healthcare Services | -1.55% | N/A | -0.44% |
Volatility and Risk
National HealthCare has a beta of 0.27, meaning that its share price is 73% less volatile than the S&P 500. Comparatively, Diversicare Healthcare Services has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for National HealthCare and Diversicare Healthcare Services, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| National HealthCare | 0 | 0 | 0 | 0 | N/A |
| Diversicare Healthcare Services | 0 | 0 | 0 | 0 | N/A |
Summary
National HealthCare beats Diversicare Healthcare Services on 8 of the 10 factors compared between the two stocks.
About National HealthCare
National HealthCare Corporation operates, manages, and provides services to skilled nursing facilities, assisted living facilities, independent living facilities, and home health care programs. Its skilled nursing facilities offer licensed therapy services, nutrition services, social services, activities, and housekeeping and laundry services, as well as medical services prescribed by physicians; and rehabilitative services, such as physical, speech, respiratory, and occupational therapy for patients recovering from strokes, heart attacks, orthopedic conditions, neurological illnesses, or other illnesses, injuries, or disabilities. The company’s medical specialty units comprise memory care units and subacute nursing units that provide specialized care and programs for persons with Alzheimer’s or related disorders; and assisted living centers offer personal care services and assistance with general activities of daily living, such as dressing, bathing, meal preparation, and medication management. It also owns, leases, and manages independent living facilities that provide specially designed residential units for the active and ambulatory elderly, as well as offers various ancillary services for its residents, including restaurants, activity rooms, and social areas. In addition, it provides health care programs that offer skilled services, such as infusion, wound care and physical, occupational, and speech therapies; operates pharmacies; offers management, accounting, financial, and insurance services; and leases its properties to third party operators. As of December 31, 2019, the company operated 75 skilled nursing facilities with 9,513 licensed beds; 25 assisted living facilities; 5 independent living facilities; 35 homecare programs; and 4 pharmacy locations. National HealthCare Corporation was founded in 1971 and is based in Murfreesboro, Tennessee.
About Diversicare Healthcare Services
Diversicare Healthcare Services, Inc. provides post-acute care services to skilled nursing centers, patients, and residents primarily in the Southeast, Midwest, and Southwest United States. The company offers skilled nursing health care services, including nutrition, recreational therapy, social, housekeeping, and laundry services; the delivery of ancillary medical services at the nursing centers; rehabilitation therapy services, such as audiology, speech, occupational, and physical therapies; and medical supplies, nutritional support, infusion therapies, and related clinical services. As of December 31, 2019, it operated 62 nursing centers with 7,329 licensed nursing beds. The company was formerly known as Advocat Inc. and changed its name to Diversicare Healthcare Services, Inc. in March 2013. Diversicare Healthcare Services, Inc. was founded in 1994 and is based in Brentwood, Tennessee.
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