HealthSouth Corporation (HLS) vs. Air Methods Corp (AIRM) Head-To-Head Analysis

HealthSouth Corporation (NYSE: HLS) and Air Methods Corp (NASDAQ:AIRM) are both medical companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, earnings, institutional ownership and dividends.

Risk & Volatility

HealthSouth Corporation has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Air Methods Corp has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500.

Dividends

HealthSouth Corporation pays an annual dividend of $1.00 per share and has a dividend yield of 2.2%. Air Methods Corp does not pay a dividend. HealthSouth Corporation pays out 36.8% of its earnings in the form of a dividend. Air Methods Corp has increased its dividend for 3 consecutive years.

Profitability

This table compares HealthSouth Corporation and Air Methods Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HealthSouth Corporation 6.70% 25.07% 5.51%
Air Methods Corp 6.67% 14.18% 4.43%

Earnings & Valuation

This table compares HealthSouth Corporation and Air Methods Corp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
HealthSouth Corporation $3.77 billion 1.19 $817.10 million $2.72 16.69
Air Methods Corp N/A N/A N/A $2.59 16.58

HealthSouth Corporation has higher revenue and earnings than Air Methods Corp. Air Methods Corp is trading at a lower price-to-earnings ratio than HealthSouth Corporation, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for HealthSouth Corporation and Air Methods Corp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HealthSouth Corporation 1 3 4 0 2.38
Air Methods Corp 0 3 1 0 2.25

HealthSouth Corporation currently has a consensus price target of $50.57, suggesting a potential upside of 11.37%. Air Methods Corp has a consensus price target of $42.50, suggesting a potential downside of 1.05%. Given HealthSouth Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe HealthSouth Corporation is more favorable than Air Methods Corp.

Institutional & Insider Ownership

93.1% of HealthSouth Corporation shares are owned by institutional investors. 1.6% of HealthSouth Corporation shares are owned by insiders. Comparatively, 9.0% of Air Methods Corp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

HealthSouth Corporation beats Air Methods Corp on 10 of the 14 factors compared between the two stocks.

About HealthSouth Corporation

HealthSouth Corporation (HealthSouth) is a provider of post-acute healthcare services, offering both facility-based and home-based post-acute services in 35 states and Puerto Rico through its network of inpatient rehabilitation hospitals, home health agencies and hospice agencies. The Company manages its operations through segments, including inpatient rehabilitation, and home health and hospice. It is an owner and operator of inpatient rehabilitation hospitals. It provides specialized rehabilitative treatment on both an inpatient and outpatient basis. It offers its home health and hospice services through Encompass Home Health and Hospice business (Encompass). Encompass operates home health and hospice agencies in 25 states, with concentrations in the Southeast, Oklahoma, and Texas. As of December 31, 2016, the Company operated 123 inpatient rehabilitation hospitals. As of December 31, 2016, the Company managed five inpatient rehabilitation units through management contracts.

About Air Methods Corp

Air Methods Corporation is engaged in providing air medical emergency transport services and systems throughout the United States. The Company’s segments include Air Medical Services (AMS), Tourism and United Rotorcraft (UR) Division. As of December 31, 2016, its AMS Division provided air medical transportation services in 41 states to the general population as an independent service (also called community-based services) and to hospitals or other institutions under exclusive operating agreements (also called hospital-based services). It transports persons requiring intensive medical care from either the scene of an accident or general care hospitals to skilled trauma centers or tertiary care centers. As of December 31, 2016, its Air Medical Services Division operated 394 helicopters and 31 fixed wing aircrafts under both Instrument Flight Rules (IFR) and Visual Flight Rules (VFR). As of December 31, 2016, its Tourism Division operated 63 helicopters and two fixed wing aircrafts.

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