Financial Contrast: Phreesia (NYSE:PHR) versus HealthStream (NASDAQ:HSTM)

Phreesia (NYSE:PHR) and HealthStream (NASDAQ:HSTM) are both small-cap healthcare companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, risk, profitability, institutional ownership and earnings.

Volatility and Risk

Phreesia has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, HealthStream has a beta of 0.44, suggesting that its share price is 56% less volatile than the S&P 500.

Valuation & Earnings

This table compares Phreesia and HealthStream”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Phreesia	$480.59 million	1.34	$2.31 million	$0.17	61.21
HealthStream	$304.06 million	2.85	$18.34 million	$0.72	41.15

HealthStream has lower revenue, but higher earnings than Phreesia. HealthStream is trading at a lower price-to-earnings ratio than Phreesia, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Phreesia and HealthStream, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Phreesia	1	10	8	0	2.37
HealthStream	0	3	0	0	2.00

Phreesia currently has a consensus target price of $14.00, suggesting a potential upside of 34.54%. HealthStream has a consensus target price of $27.00, suggesting a potential downside of 8.88%. Given Phreesia’s stronger consensus rating and higher probable upside, research analysts clearly believe Phreesia is more favorable than HealthStream.

Profitability

This table compares Phreesia and HealthStream’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Phreesia	2.06%	5.22%	3.02%
HealthStream	6.60%	6.81%	4.64%

Insider and Institutional Ownership

92.1% of Phreesia shares are owned by institutional investors. Comparatively, 69.6% of HealthStream shares are owned by institutional investors. 5.2% of Phreesia shares are owned by insiders. Comparatively, 20.4% of HealthStream shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

About Phreesia

Phreesia, Inc. provides an integrated SaaS-based software and payment platform for the healthcare industry in the United States and Canada. The company offers access solutions that offers appointment scheduling system for online appointments, reminders, and referral tracking management; registration solution to automate patient self-registration; revenue cycle solution, which offer insurance-verification processes, point-of-sale payments applications, post-visit payment collection, and flexible payment options; and network connect solution to deliver clinically relevant content to patients. The company deploys its platform in a range of modalities, such as Phreesia Mobile, a patients' mobile device; Phreesia Dashboard, a web-based dashboard for healthcare services clients; PhreesiaPads, a self-service intake tablets; and Arrivals Kiosks, an on-site kiosks. It serves patients; single-specialty practices, multi-specialty groups, and health systems; and pharmaceutical, medical device, and biotechnology companies. The company was incorporated in 2005 and is based in Wilmington, Delaware.

About HealthStream

HealthStream, Inc. provides Software-as-a-Service (SaaS) based applications for healthcare organizations in the United States. The company’s solutions help healthcare organizations in meeting their ongoing clinical development, talent management, training, education, assessment, competency management, safety and compliance, and scheduling, as well as provider credentialing, privileging, and enrollment needs. It offers hStream, a technology platform that powers a range of healthcare workforce solutions. The company provides its solutions to customers across a range of entities within the healthcare industry, including private, not-for-profit, and government entities, as well as pharmaceutical and medical device companies through its direct sales teams. The company was incorporated in 1990 and is headquartered in Nashville, Tennessee.