Critical Survey: U.S. Physical Therapy (NYSE:USPH) versus RadNet (NASDAQ:RDNT)

RadNet (NASDAQ:RDNT) and U.S. Physical Therapy (NYSE:USPH) are both medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, analyst recommendations and earnings.

Institutional and Insider Ownership

77.9% of RadNet shares are owned by institutional investors. 5.6% of RadNet shares are owned by company insiders. Comparatively, 2.0% of U.S. Physical Therapy shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

RadNet has a beta of 1.58, suggesting that its share price is 58% more volatile than the S&P 500. Comparatively, U.S. Physical Therapy has a beta of 1.47, suggesting that its share price is 47% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for RadNet and U.S. Physical Therapy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RadNet	1	1	4	2	2.88
U.S. Physical Therapy	0	3	4	1	2.75

RadNet presently has a consensus price target of $84.00, indicating a potential upside of 6.11%. U.S. Physical Therapy has a consensus price target of $110.25, indicating a potential upside of 59.36%. Given U.S. Physical Therapy’s higher possible upside, analysts plainly believe U.S. Physical Therapy is more favorable than RadNet.

Valuation & Earnings

This table compares RadNet and U.S. Physical Therapy”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RadNet	$1.97 billion	3.10	$2.79 million	($0.17)	-465.65
U.S. Physical Therapy	$758.71 million	1.39	$31.42 million	$2.38	29.07

U.S. Physical Therapy has lower revenue, but higher earnings than RadNet. RadNet is trading at a lower price-to-earnings ratio than U.S. Physical Therapy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares RadNet and U.S. Physical Therapy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RadNet	-0.78%	2.41%	0.82%
U.S. Physical Therapy	5.05%	8.78%	3.81%

About RadNet

RadNet, Inc., together with its subsidiaries, provides outpatient diagnostic imaging services in the United States. The company operates in two segments: Imaging Centers and Artificial Intelligence. Its services include magnetic resonance imaging, computed tomography, positron emission tomography, nuclear medicine, mammography, ultrasound, diagnostic radiology, fluoroscopy, and other related procedures, as well as multi-modality imaging services. The company also develops and sells computerized systems that distribute, display, store, and retrieve digital images; offers picture archiving communications systems and related services; and develops and deploys AI suites to enhance radiologist interpretation of breast, lung, and prostate images, as well as AI solutions for prostate cancer screening. RadNet, Inc. was founded in 1981 and is headquartered in Los Angeles, California.

About U.S. Physical Therapy

U.S. Physical Therapy, Inc. operates outpatient physical therapy clinics. The company operates through Physical Therapy Operations and Industrial Injury Prevention Services segments. The company provides pre-and post-operative care and treatment for orthopedic-related disorders, sports-related injuries, preventative care, rehabilitation of injured workers, and neurological-related injuries. It offers industrial injury prevention services, including onsite injury prevention and rehabilitation, performance optimization, post-offer employment testing, functional capacity evaluations, and ergonomic assessments through physical therapists and specialized certified athletic trainers for Fortune 500 companies, and other clients comprising insurers and their contractors. U.S. Physical Therapy, Inc. was founded in 1990 and is based in Houston, Texas.