Zacks Research Upgrades Healthcare Services Group (NASDAQ:HCSG) to Strong-Buy

Key Points

• Zacks Research upgraded Healthcare Services Group to “strong buy” from “hold.” The broader analyst consensus is “Moderate Buy,” with an average price target of $26.67.
• HCSG shares opened at $24.68, up 2.6%, near their 12-month high of $25.75. The company reported quarterly EPS of $0.36, exceeding the $0.24 consensus estimate, while revenue of $479.6 million was slightly below forecasts.
• Institutional investors own approximately 97.97% of the stock, including a new $279.4 million position initiated by BlackRock. Meanwhile, two executives recently sold shares, reducing their individual holdings substantially.

Healthcare Services Group (NASDAQ:HCSG - Get Free Report) was upgraded by investment analysts at Zacks Research from a "hold" rating to a "strong-buy" rating in a report released on Wednesday, Zacks reports.

A number of other brokerages have also commented on HCSG. Oppenheimer assumed coverage on Healthcare Services Group in a research report on Wednesday, August 19th. They issued an "outperform" rating and a $28.00 target price for the company. Wall Street Zen lowered Healthcare Services Group from a "buy" rating to a "hold" rating in a report on Saturday, August 1st. UBS Group raised their price objective on Healthcare Services Group from $27.00 to $30.00 and gave the company a "buy" rating in a research note on Wednesday, July 8th. Weiss Ratings upgraded Healthcare Services Group from a "buy (b-)" rating to a "buy (b)" rating in a report on Friday, September 25th. Finally, Robert W. Baird decreased their price objective on Healthcare Services Group from $26.00 to $24.00 and set a "neutral" rating for the company in a report on Thursday, October 8th. One research analyst has rated the stock with a Strong Buy rating, six have assigned a Buy rating and three have given a Hold rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus target price of $26.67.

Healthcare Services Group Trading Up 2.6%

Shares of HCSG opened at $24.68 on Wednesday. The firm's fifty day simple moving average is $21.94 and its two-hundred day simple moving average is $21.36. Healthcare Services Group has a 12 month low of $16.78 and a 12 month high of $25.75. The stock has a market capitalization of $1.66 billion, a P/E ratio of 16.15 and a beta of 0.81.

Healthcare Services Group (NASDAQ:HCSG - Get Free Report) last issued its quarterly earnings results on Wednesday, October 21st. The business services provider reported $0.36 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.24 by $0.12. The firm had revenue of $479.60 million for the quarter, compared to analyst estimates of $480.80 million. Healthcare Services Group had a return on equity of 20.22% and a net margin of 5.58%. During the same period in the previous year, the firm earned $0.59 earnings per share. As a group, research analysts predict that Healthcare Services Group will post 1.32 EPS for the current fiscal year.

Insider Transactions at Healthcare Services Group

In other Healthcare Services Group news, EVP Jason J. Bundick sold 18,239 shares of the stock in a transaction dated Monday, October 26th. The shares were sold at an average price of $25.11, for a total value of $457,981.29. Following the completion of the sale, the executive vice president owned 17,125 shares in the company, valued at approximately $430,008.75. This trade represents a 51.58% decrease in their position. The transaction was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, COO Andrew Kush sold 15,598 shares of Healthcare Services Group stock in a transaction that occurred on Tuesday, August 4th. The stock was sold at an average price of $23.24, for a total transaction of $362,497.52. Following the transaction, the chief operating officer directly owned 22,741 shares in the company, valued at approximately $528,500.84. This represents a 40.68% decrease in their position. The SEC filing for this sale provides additional information. Corporate insiders own 2.90% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of HCSG. BlackRock Inc. bought a new stake in shares of Healthcare Services Group in the 2nd quarter worth approximately $279,379,000. Arrowstreet Capital Limited Partnership grew its holdings in Healthcare Services Group by 454.0% during the first quarter. Arrowstreet Capital Limited Partnership now owns 1,405,952 shares of the business services provider's stock valued at $26,080,000 after purchasing an additional 1,152,176 shares during the period. Jupiter Topco LLC bought a new position in Healthcare Services Group during the second quarter valued at $22,406,000. Palisade Capital Management LP purchased a new stake in Healthcare Services Group in the second quarter worth $17,845,000. Finally, Bank of New York Mellon Corp purchased a new stake in Healthcare Services Group in the second quarter worth $10,438,000. Hedge funds and other institutional investors own 97.97% of the company's stock.

Healthcare Services Group Company Profile

Healthcare Services Group, Inc NASDAQ: HCSG provides outsourced support services to healthcare facilities in the United States. Its customers primarily include nursing homes, skilled nursing facilities, continuing care retirement communities, assisted-living facilities and other institutional healthcare providers.

The company's principal service offerings include housekeeping, laundry and linen services, as well as dining and nutritional services. These services are designed to help healthcare operators manage nonclinical functions, maintain facility standards and support the daily needs of residents and patients.

Healthcare Services Group was founded in 1976 and is headquartered in Bensalem, Pennsylvania.

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