Financial Analysis: Tenet Healthcare (NYSE:THC) versus SBC Medical Group (NASDAQ:SBC)

SBC Medical Group (NASDAQ:SBC) and Tenet Healthcare (NYSE:THC) are both healthcare companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Profitability

This table compares SBC Medical Group and Tenet Healthcare’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SBC Medical Group	24.09%	15.90%	11.61%
Tenet Healthcare	10.27%	26.76%	5.55%

Institutional & Insider Ownership

60.8% of SBC Medical Group shares are held by institutional investors. Comparatively, 95.4% of Tenet Healthcare shares are held by institutional investors. 81.7% of SBC Medical Group shares are held by insiders. Comparatively, 1.0% of Tenet Healthcare shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares SBC Medical Group and Tenet Healthcare”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SBC Medical Group	$173.61 million	1.87	$50.99 million	$0.39	8.13
Tenet Healthcare	$21.31 billion	1.01	$1.41 billion	$25.93	10.31

Tenet Healthcare has higher revenue and earnings than SBC Medical Group. SBC Medical Group is trading at a lower price-to-earnings ratio than Tenet Healthcare, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

SBC Medical Group has a beta of 0.59, suggesting that its share price is 41% less volatile than the S&P 500. Comparatively, Tenet Healthcare has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for SBC Medical Group and Tenet Healthcare, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SBC Medical Group	1	0	2	0	2.33
Tenet Healthcare	0	2	17	1	2.95

SBC Medical Group presently has a consensus target price of $8.50, suggesting a potential upside of 167.97%. Tenet Healthcare has a consensus target price of $272.25, suggesting a potential upside of 1.81%. Given SBC Medical Group’s higher possible upside, equities analysts plainly believe SBC Medical Group is more favorable than Tenet Healthcare.

Summary

Tenet Healthcare beats SBC Medical Group on 10 of the 15 factors compared between the two stocks.

About SBC Medical Group

SBC Medical Group Holdings Incorporated, through its subsidiaries, provides services to support the operation of clinics which deliver specialized medical services in the areas of cosmetic medicine, esthetic dentistry and Androgenetic Alopecia or AGA, primarily in Japan and centered on the SBC Shonan Beauty Clinic Brand. SBC Medical Group Holdings Incorporated, formerly known as Pono Capital Two Inc., is based in TOKYO.

About Tenet Healthcare

Tenet Healthcare Corporation operates as a diversified healthcare services company in the United States. The company operates through two segments: Hospital Operations and Services, and Ambulatory Care. Its general hospitals offer acute care services, operating and recovery rooms, radiology and respiratory therapy services, clinical laboratories, and pharmacies. The company also provides intensive and critical care, and/or coronary care units; cardiovascular, digestive disease, neurosciences, musculoskeletal, and obstetrics services; outpatient services, including physical therapy; tertiary care services, such as cardiothoracic surgery, complex spinal surgery, neonatal intensive care, and neurosurgery services; quaternary care services in heart and kidney transplants; and limb salvaging vascular procedure, acute level 1 trauma, intravascular stroke care, minimally invasive cardiac valve replacement, imaging, surgical robotic, and telemedicine access services. In addition, it offers a range of procedures and services, such as orthopedics, total joint replacement, and spinal and other musculoskeletal procedures; gastroenterology; pain management; otolaryngology; ophthalmology; and urology. It operates hospitals, ambulatory surgery centers, imaging centers, surgical hospitals, off-campus emergency departments, and micro-hospitals. Tenet Healthcare Corporation was founded in 1967 and is headquartered in Dallas, Texas.