Critical Comparison: BrightSpring Health Services (NASDAQ:BTSG) and Tenet Healthcare (NYSE:THC)

Tenet Healthcare (NYSE:THC) and BrightSpring Health Services (NASDAQ:BTSG) are both large-cap healthcare companies, but which is the better stock? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Tenet Healthcare and BrightSpring Health Services, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tenet Healthcare	0	3	20	0	2.87
BrightSpring Health Services	0	0	17	2	3.11

Tenet Healthcare presently has a consensus price target of $293.48, indicating a potential upside of 1.14%. BrightSpring Health Services has a consensus price target of $77.81, indicating a potential upside of 7.34%. Given BrightSpring Health Services’ stronger consensus rating and higher possible upside, analysts clearly believe BrightSpring Health Services is more favorable than Tenet Healthcare.

Volatility and Risk

Tenet Healthcare has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500. Comparatively, BrightSpring Health Services has a beta of 1.77, suggesting that its share price is 77% more volatile than the S&P 500.

Valuation and Earnings

This table compares Tenet Healthcare and BrightSpring Health Services”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tenet Healthcare	$21.31 billion	1.08	$1.41 billion	$34.48	8.42
BrightSpring Health Services	$12.91 billion	1.12	$190.67 million	$1.85	39.18

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

Insider & Institutional Ownership

95.4% of Tenet Healthcare shares are owned by institutional investors. 1.0% of Tenet Healthcare shares are owned by company insiders. Comparatively, 2.8% of BrightSpring Health Services shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Tenet Healthcare and BrightSpring Health Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tenet Healthcare	13.09%	28.22%	6.12%
BrightSpring Health Services	2.69%	18.56%	6.03%

Summary

Tenet Healthcare beats BrightSpring Health Services on 8 of the 15 factors compared between the two stocks.

About Tenet Healthcare

Tenet Healthcare Corporation is a U.S.-based healthcare services company that operates acute care hospitals and provides related inpatient and outpatient services. Its hospitals offer services across areas such as emergency care, surgery, imaging and specialty treatment. Through its subsidiary United Surgical Partners International (USPI), Tenet also operates ambulatory surgery centers and surgical hospitals, providing outpatient surgical and procedural care. The company’s Conifer Health Solutions business provides revenue cycle management and other administrative services to healthcare providers.

About BrightSpring Health Services

BrightSpring Health Services is a provider of home- and community-based health services in the United States. The company supports people with complex health needs, including individuals with intellectual and developmental disabilities, behavioral health conditions, and chronic or age-related illnesses. Its services include home health and hospice care, behavioral health and rehabilitation, residential and community-based support, and pharmacy services. BrightSpring’s pharmacy operations provide prescription dispensing and related services to people receiving care in homes, community settings, and long-term care facilities.