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Analyst Blog

Healthcare Services Group, Inc. (HCSG - Snapshot Report) posted operating profit of 20 cents per share in the second quarter of fiscal 2014, ending Jun 30. The bottom line lagged the Zacks Consensus Estimate by a couple of cents but increased a penny from the year-ago quarter on an improved top line.

Behind the Headlines

Healthcare Services Group’s revenues for the quarter improved nearly 17% year over year to $319.3 million. However, the top line missed the Zacks Consensus Estimate of $324 million.

Cost of services provided increased 17% and selling, general and administrative expenses rose 14%.

Despite steeper expenses, a higher magnitude of revenue increase led to an 8.2% improvement in income from operations at Healthcare Services Group.

Financial Update

Healthcare Services Group exited the quarter with cash and cash equivalents of $57.3 million, down 10.7% from fiscal 2013 end.

Total asset as of Jun 30 was $441.2 million, up 3.7% from fiscal 2013 end.

Stockholders' equity was $301.8 million on Jun 30, up 5.8% from fiscal 2013 end.

Dividend Update

The board of directors of Healthcare Services Group declared a quarterly cash dividend of 17.375 cents per share, reflecting an increase of 1.5%. The increased dividend will be paid on Sep 26, 2014 to shareholders of record on Aug 22, 2014. While this marks the 44th dividend hike without break, it also represents the 45th consecutive quarterly cash dividend payment by the company.

Zacks Rank and Other Players

Healthcare Services Group presently carries a Zacks Rank #3 (Hold). Among the better-ranked business service providers, Avis Budget Group, Inc. (CAR - Analyst Report) and ExamWorks Group, Inc. (EXAM - Snapshot Report) beat their respective Zacks Consensus Estimate in their last reported quarter. Avis Budget Group and ExamWorks Group sport a Zacks Rank #1 (Strong Buy).  Another player Cardtronics Inc. (CATM - Snapshot Report) also surpassed the Zacks Consensus Estimate in last reported quarter.
 

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