Healthcare Services Group (NASDAQ:HCSG) Releases Quarterly Earnings Results, Beats Estimates By $0.12 EPS

Healthcare Services Group (NASDAQ:HCSG) announced its earnings results on Wednesday. The business services provider reported $0.36 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.24 by $0.12, FiscalAI reports. Healthcare Services Group had a return on equity of 20.22% and a net margin of 5.58%. The company had revenue of $479.60 million for the quarter, compared to analysts’ expectations of $480.80 million. During the same quarter in the previous year, the firm earned $0.59 earnings per share.

Here are the key takeaways from Healthcare Services Group’s conference call:

• Q3 revenue reached $479.6 million, with net income of $24.9 million and diluted EPS of $0.36. Strong service execution, lower bad debt expense, and high client retention supported margins.
• Management expects Q4 revenue of $535 million to $545 million and raised its 2027 revenue-growth outlook from mid-single digits to low double digits, including mid-single-digit organic growth and the NEXDINE contribution.
• The NEXDINE Hospitality acquisition is expected to add more than $150 million in annual revenue at comparable margins, be immediately accretive to EPS, and provide a double-digit growth opportunity in senior living and hospitality markets.
• HCSG ended the quarter with $204.3 million in cash and marketable securities and an undrawn $300 million credit facility. The company repurchased $11.7 million of stock in Q3, bringing year-to-date repurchases to $56.6 million.
• Management cautioned that bad debt and workers’ compensation costs remain volatile despite recent improvement, while the Genesis bankruptcy recovery beyond the recognized $6.1 million remains uncertain and subject to contingencies.

Healthcare Services Group Stock Performance

HCSG stock traded down $0.28 during mid-day trading on Friday, hitting $24.52. The company had a trading volume of 140,848 shares, compared to its average volume of 729,557. The firm has a market cap of $1.68 billion, a PE ratio of 14.27 and a beta of 0.81. Healthcare Services Group has a 12 month low of $16.78 and a 12 month high of $25.75. The stock’s fifty day moving average price is $21.67 and its two-hundred day moving average price is $21.90.

Insiders Place Their Bets

In other Healthcare Services Group news, COO Andrew Kush sold 15,598 shares of the business’s stock in a transaction dated Tuesday, August 4th. The shares were sold at an average price of $23.24, for a total value of $362,497.52. Following the transaction, the chief operating officer directly owned 22,741 shares in the company, valued at $528,500.84. The trade was a 40.68% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. 2.90% of the stock is currently owned by insiders.

Wall Street Analyst Weigh In

Several equities analysts have weighed in on the company. UBS Group raised their price objective on Healthcare Services Group from $27.00 to $30.00 and gave the company a “buy” rating in a research note on Wednesday, July 8th. Oppenheimer initiated coverage on shares of Healthcare Services Group in a report on Wednesday, August 19th. They set an “outperform” rating and a $28.00 price objective on the stock. Wall Street Zen lowered shares of Healthcare Services Group from a “buy” rating to a “hold” rating in a research note on Saturday, August 1st. Robert W. Baird lowered their target price on shares of Healthcare Services Group from $26.00 to $24.00 and set a “neutral” rating for the company in a report on Thursday, October 8th. Finally, Zacks Research downgraded shares of Healthcare Services Group from a “strong-buy” rating to a “hold” rating in a report on Tuesday, September 29th. Six analysts have rated the stock with a Buy rating and four have given a Hold rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and a consensus price target of $26.67.

Healthcare Services Group Company Profile

Healthcare Services Group, Inc (NASDAQ:HCSG) provides outsourced support services to healthcare facilities in the United States. Its customers primarily include nursing homes, skilled nursing facilities, continuing care retirement communities, assisted-living facilities and other institutional healthcare providers.

The company’s principal service offerings include housekeeping, laundry and linen services, as well as dining and nutritional services. These services are designed to help healthcare operators manage nonclinical functions, maintain facility standards and support the daily needs of residents and patients.

Healthcare Services Group was founded in 1976 and is headquartered in Bensalem, Pennsylvania.