The Advisory Board (NASDAQ: ABCO) and Huron Consulting Group (NASDAQ:HURN) are both medical companies, but which is the superior business? We will contrast the two companies based on the strength of their profitabiliy, earnings, analyst recommendations, institutional ownership, dividends, valuation and risk.

Profitability

This table compares The Advisory Board and Huron Consulting 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%
Huron Consulting Group -15.94% 8.83% 4.64%

Risk and Volatility

The Advisory Board has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, Huron Consulting Group has a beta of 0.12, meaning that its stock price is 88% less volatile than the S&P 500.

Valuation and Earnings

This table compares The Advisory Board and Huron Consulting Group’s top-line 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 2.72 $118.16 million $2.51 21.27
Huron Consulting Group $731.79 million 0.98 $112.11 million ($5.98) -5.58

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

Institutional & Insider Ownership

92.9% of Huron Consulting Group shares are owned by institutional investors. 4.7% of The Advisory Board shares are owned by company insiders. Comparatively, 2.7% of Huron Consulting Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and target prices for The Advisory Board and Huron Consulting 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
Huron Consulting Group 0 3 1 0 2.25

The Advisory Board currently has a consensus target price of $49.64, suggesting a potential downside of 7.05%. Given The Advisory Board’s stronger consensus rating and higher probable upside, equities research analysts plainly believe The Advisory Board is more favorable than Huron Consulting Group.

Summary

The Advisory Board beats Huron Consulting Group on 12 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.

Huron Consulting Group Company Profile

Huron Consulting Group Inc. is a global professional services firm. The Company offers solutions in operations, advisory services, technology and analytics for healthcare, higher education, life sciences and commercial sectors. The Company’s segments include Healthcare, Education and Life Sciences, and Business Advisory. Its Healthcare segment provides advisory services, from strategy setting through implementation, in the areas of organizational and resource alignment, clinical transformation, financial and operational performance, patient and caregiver engagement, and technology implementation and optimization. Its Education and Life Sciences segment provides management consulting and technology solutions to the higher education and academic medical centers, pharmaceutical and medical device, biotechnology and research industries. The Business Advisory segment’s primary service lines include Enterprise Solutions and Analytics, and Business Advisory.

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