Healthcare Services Group (NASDAQ:HCSG) Sets New 1-Year High Following Earnings Beat

Key Points

• Shares hit a new 52-week high after Healthcare Services Group reported an EPS of $0.37, beating estimates by $0.15; the stock traded as high as $24.39 and was last at $22.89, up about 18.3% on the day.
• Revenue of $462.77 million missed consensus ($479.79M) despite a 3.4% year-over-year increase, and the company reported a 16.04% return on equity and a 3.21% net margin.
• Insiders sold a total of 146,962 shares (~$3.01 million) over the past three months (insiders now own 2.60%), while analysts are mixed with a consensus "Hold" rating and an average $22 price target.

Healthcare Services Group, Inc. (NASDAQ:HCSG - Get Free Report) shares reached a new 52-week high during mid-day trading on Thursday following a stronger than expected earnings report. The stock traded as high as $24.39 and last traded at $22.89, with a volume of 2594683 shares traded. The stock had previously closed at $19.35.

The business services provider reported $0.37 EPS for the quarter, beating analysts' consensus estimates of $0.22 by $0.15. The business had revenue of $462.77 million during the quarter, compared to the consensus estimate of $479.79 million. Healthcare Services Group had a return on equity of 16.04% and a net margin of 3.21%.The firm's revenue was up 3.4% on a year-over-year basis. During the same quarter in the prior year, the company posted $0.23 earnings per share.

Wall Street Analyst Weigh In

A number of equities research analysts recently commented on HCSG shares. UBS Group set a $25.00 price objective on Healthcare Services Group and gave the company a "buy" rating in a report on Thursday, February 12th. Weiss Ratings reissued a "hold (c+)" rating on shares of Healthcare Services Group in a research note on Monday, December 29th. Robert W. Baird set a $23.00 target price on Healthcare Services Group in a research note on Thursday, February 12th. Benchmark reissued a "buy" rating on shares of Healthcare Services Group in a research note on Thursday, February 12th. Finally, BMO Capital Markets reissued a "market perform" rating and issued a $22.00 target price on shares of Healthcare Services Group in a research note on Thursday, February 12th. Four research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company's stock. According to data from MarketBeat.com, the stock presently has an average rating of "Hold" and a consensus price target of $22.00.

Insider Transactions at Healthcare Services Group

In other news, CAO Andrew M. Brophy sold 2,490 shares of the company's stock in a transaction dated Thursday, February 26th. The stock was sold at an average price of $21.75, for a total transaction of $54,157.50. Following the completion of the transaction, the chief accounting officer directly owned 15,735 shares of the company's stock, valued at $342,236.25. This represents a 13.66% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, EVP Patrick J. Orr sold 45,500 shares of the company's stock in a transaction dated Wednesday, February 18th. The stock was sold at an average price of $20.54, for a total value of $934,570.00. Following the transaction, the executive vice president directly owned 44,615 shares of the company's stock, valued at $916,392.10. This represents a 50.49% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold 146,962 shares of company stock valued at $3,014,100 over the last three months. Company insiders own 2.60% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently modified their holdings of HCSG. Miller Global Investments LLC acquired a new position in shares of Healthcare Services Group during the fourth quarter worth about $26,000. EverSource Wealth Advisors LLC raised its holdings in Healthcare Services Group by 163.4% during the second quarter. EverSource Wealth Advisors LLC now owns 2,186 shares of the business services provider's stock worth $33,000 after acquiring an additional 1,356 shares in the last quarter. Caitong International Asset Management Co. Ltd bought a new stake in Healthcare Services Group during the fourth quarter worth about $33,000. GAMMA Investing LLC raised its holdings in Healthcare Services Group by 94.9% during the third quarter. GAMMA Investing LLC now owns 2,843 shares of the business services provider's stock worth $48,000 after acquiring an additional 1,384 shares in the last quarter. Finally, Farther Finance Advisors LLC raised its holdings in Healthcare Services Group by 32.0% during the fourth quarter. Farther Finance Advisors LLC now owns 3,619 shares of the business services provider's stock worth $69,000 after acquiring an additional 877 shares in the last quarter. 97.97% of the stock is owned by institutional investors and hedge funds.

Healthcare Services Group Stock Up 18.3%

The firm has a market cap of $1.58 billion, a P/E ratio of 27.91 and a beta of 0.80. The firm has a fifty day moving average of $19.97 and a 200-day moving average of $18.96.

Healthcare Services Group Company Profile

Healthcare Services Group, Inc NASDAQ: HCSG is a leading provider of support services to healthcare facilities across the United States. The company specializes in environmental services, including housekeeping and sanitation, as well as linen and laundry management. In addition, Healthcare Services Group offers dietary and nutrition services, catering to hospitals, skilled nursing facilities, assisted living communities and other long-term care providers.

Founded as a family-owned business in the late 1970s, the company completed its initial public offering in 1997.

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