Analyzing Black Diamond Group (OTCMKTS:BDIMF) & Healthcare Services Group (NASDAQ:HCSG)

Healthcare Services Group (NASDAQ:HCSG) and Black Diamond Group (OTCMKTS:BDIMF) are both small-cap business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, profitability, dividends, valuation, analyst recommendations and earnings.

Institutional & Insider Ownership

98.0% of Healthcare Services Group shares are held by institutional investors. 2.6% of Healthcare Services Group shares are held by insiders. Comparatively, 25.2% of Black Diamond Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Healthcare Services Group and Black Diamond Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Healthcare Services Group	$1.72 billion	0.78	$39.47 million	$0.54	34.96
Black Diamond Group	$294.14 million	2.35	$18.72 million	$0.41	24.71

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

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Healthcare Services Group and Black Diamond Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Healthcare Services Group	0	4	3	0	2.43
Black Diamond Group	0	0	1	0	3.00

Healthcare Services Group presently has a consensus price target of $19.40, suggesting a potential upside of 2.75%. Given Healthcare Services Group’s higher possible upside, research analysts plainly believe Healthcare Services Group is more favorable than Black Diamond Group.

Volatility and Risk

Healthcare Services Group has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500. Comparatively, Black Diamond Group has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Profitability

This table compares Healthcare Services Group and Black Diamond Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Healthcare Services Group	2.20%	12.23%	7.52%
Black Diamond Group	8.23%	10.76%	4.79%

Summary

Healthcare Services Group beats Black Diamond Group on 9 of the 14 factors compared between the two stocks.

About Healthcare Services Group

Healthcare Services Group, Inc. provides management, administrative, and operating services to the housekeeping, laundry, linen, facility maintenance, and dietary service departments of nursing homes, retirement complexes, rehabilitation centers, and hospitals in the United States. It operates through two segments, Housekeeping and Dietary. The Housekeeping segment engages in the cleaning, disinfecting, and sanitizing of resident rooms and common areas of the customers' facilities, as well as laundering and processing of the bed linens, uniforms, resident personal clothing, and other assorted linen items utilized at the customers' facilities. The Dietary segment provides food purchasing, meal preparation, and professional dietitian services, which include the development of menus that meet the dietary needs of residents; and on-site management and clinical consulting services to facilities. It serves long-term and post-acute care facilities, hospitals, and the healthcare industry through referrals and solicitation of target facilities. The company was incorporated in 1976 and is based in Bensalem, Pennsylvania.

About Black Diamond Group

Black Diamond Group Limited rents and sells modular space and workforce accommodation solutions. It operates through two segments, Modular Space Solutions and Workforce Solutions. The Modular Space Solutions segment provides modular space rentals to customers in the construction, real estate development, education, manufacturing, health care, financial, government, and defense industries in North America. Its products include office units, lavatories, storage units, large multi-unit office complexes, classroom facilities, banking and health care facilities, high security modular buildings, custom manufactured modular facilities, blast resistant structures, SmartSpace interchangeable paneled units, and storage containers. This segment also sells new and used space rentals units; and provides delivery, installation, project management, and ancillary rental items, products, and services. The Workforce Solutions segment provides workforce housing solutions, including rental of accommodations and surface equipment, and provision of turnkey lodging and travel management logistics services in Canada, the United States, and Australia. This segment also provides associated services, such as installation, transportation, dismantlement, and sale of used fleet assets. This segment primarily serves the resource, infrastructure, construction, disaster recovery, and education sectors. It also provides specialized field rentals to oil and gas industries. The company markets its rental assets, custom sales, and ancillary products and services through in-house sales personnel, its website, social media, web campaigns, and its digital marketplace. Black Diamond Group Limited was founded in 2003 and is headquartered in Calgary, Canada.