The Advisory Board (NASDAQ: ABCO) and Willdan Group (NASDAQ:WLDN) are both medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, profitabiliy, risk and valuation.

Profitability

This table compares The Advisory Board and Willdan Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Advisory Board 12.78% 14.48% 3.58%
Willdan Group 3.90% 19.67% 9.04%

Risk & Volatility

The Advisory Board has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, Willdan Group has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500.

Valuation and Earnings

This table compares The Advisory Board and Willdan Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
The Advisory Board $797.23 million 2.77 $118.16 million $2.51 21.69
Willdan Group $243.38 million 1.19 $15.27 million $1.12 30.03

The Advisory Board has higher revenue and earnings than Willdan Group. The Advisory Board is trading at a lower price-to-earnings ratio than Willdan Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations for The Advisory Board and Willdan Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Advisory Board 1 6 6 0 2.38
Willdan Group 0 0 2 0 3.00

The Advisory Board presently has a consensus target price of $49.64, indicating a potential downside of 8.84%. Willdan Group has a consensus target price of $38.00, indicating a potential upside of 12.99%. Given Willdan Group’s stronger consensus rating and higher possible upside, analysts clearly believe Willdan Group is more favorable than The Advisory Board.

Insider and Institutional Ownership

48.3% of Willdan Group shares are held by institutional investors. 4.7% of The Advisory Board shares are held by insiders. Comparatively, 13.3% of Willdan Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

The Advisory Board beats Willdan Group on 8 of the 14 factors compared between the two stocks.

The Advisory Board Company Profile

The Advisory Board Company is a provider of software and solutions to the healthcare and higher education industries. The Company offers subscription-based membership programs, software and data-enabled services. All of its programs are rooted in best practices and extends across four areas, including Best practices research, Technology, Data-enabled services and Consulting services. The best practices research and insight programs provide the foundation for all of its other programs. The Company offers technology analytics programs anchored by cloud-based software applications that surface performance improvement opportunities to accelerate progress. Through its consulting services, the Company provides on-the-ground support for performance improvement initiatives, as well as best practice professional management of areas of the hospital or medical group. The Company’s data-enabled services are primarily focused in the area of enrollment management.

Willdan Group Company Profile

Willdan Group, Inc. is a holding company. The Company provides professional technical and consulting services to utilities, private industry and public agencies at all levels of government, primarily in California and New York. It operates through four segments: Energy Efficiency Services, Engineering Services, Public Finance Services and Homeland Security Services. The Energy Efficiency Services segment provides energy efficiency consulting services to utilities, state agencies, municipalities, private industry and non-profit organizations. The Engineering Services segment offers a range of engineering and planning services to its public and private sector clients. The Public Finance Services segment provides support for the various financing techniques employed by public agencies to finance their operations and infrastructure. The Homeland Security Services segment provides national preparedness, homeland security consulting, public safety and emergency response services.

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