Analyzing McKesson (NYSE:MCK) and P3 Health Partners (NASDAQ:PIII)

P3 Health Partners (NASDAQ:PIII) and McKesson (NYSE:MCK) are both healthcare companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations for P3 Health Partners and McKesson, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
P3 Health Partners	1	2	1	0	2.00
McKesson	0	4	14	0	2.78

P3 Health Partners presently has a consensus price target of $17.00, suggesting a potential upside of 159.94%. McKesson has a consensus price target of $973.44, suggesting a potential upside of 12.54%. Given P3 Health Partners’ higher possible upside, analysts clearly believe P3 Health Partners is more favorable than McKesson.

Volatility and Risk

P3 Health Partners has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500. Comparatively, McKesson has a beta of 0.3, indicating that its stock price is 70% less volatile than the S&P 500.

Insider & Institutional Ownership

7.7% of P3 Health Partners shares are owned by institutional investors. Comparatively, 85.1% of McKesson shares are owned by institutional investors. 10.9% of P3 Health Partners shares are owned by insiders. Comparatively, 0.1% of McKesson shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares P3 Health Partners and McKesson”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
P3 Health Partners	$1.46 billion	0.03	-$147.95 million	($33.00)	-0.20
McKesson	$410.98 billion	0.25	$4.76 billion	$37.37	23.15

McKesson has higher revenue and earnings than P3 Health Partners. P3 Health Partners is trading at a lower price-to-earnings ratio than McKesson, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares P3 Health Partners and McKesson’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
P3 Health Partners	-6.55%	N/A	-16.40%
McKesson	1.12%	-253.21%	5.90%

Summary

McKesson beats P3 Health Partners on 10 of the 14 factors compared between the two stocks.

About P3 Health Partners

P3 Health Partners Inc., a patient-centered and physician-led population health management company, provides superior care services in the United States. It operates clinics and wellness centers. P3 Health Partners Inc. was founded in 2020 and is based in Henderson, Nevada.

About McKesson

McKesson Corporation provides healthcare services in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International. The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter pharmaceutical drugs, and other healthcare-related products. This segment also offers practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices; and consulting, outsourcing, technological, and other services, as well as sells financial, operational, and clinical solutions to pharmacies. The RxTS segment serves biopharma and life sciences partners, and patients to address medication challenges for patients by working across healthcare; connects patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to deliver innovative solutions to help people get the medicine needed to live healthier lives; and provides prescription price transparency, benefit insight, dispensing support, third-party logistics, and wholesale distribution support services. The Medical-Surgical Solutions segment offers medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. The International segment provides distribution and services to wholesale, institutional, and retail customers in Europe and Canada. McKesson Corporation was founded in 1833 and is headquartered in Irving, Texas.