Alignment Healthcare (NASDAQ:ALHC) and Humana (NYSE:HUM) are both medical companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, dividends, risk, institutional ownership, valuation, analyst recommendations and earnings.
Valuation and Earnings
This table compares Alignment Healthcare and Humana’s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Alignment Healthcare | $959.22 million | 4.61 | -$22.93 million | N/A | N/A |
| Humana | $77.16 billion | 0.70 | $3.37 billion | $18.75 | 22.36 |
Humana has higher revenue and earnings than Alignment Healthcare.
Insider & Institutional Ownership
77.5% of Alignment Healthcare shares are owned by institutional investors. Comparatively, 92.1% of Humana shares are owned by institutional investors. 0.4% of Humana shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Alignment Healthcare and Humana, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alignment Healthcare | 0 | 3 | 4 | 0 | 2.57 |
| Humana | 0 | 4 | 10 | 0 | 2.71 |
Alignment Healthcare presently has a consensus target price of $30.67, indicating a potential upside of 29.94%. Humana has a consensus target price of $470.22, indicating a potential upside of 12.18%. Given Alignment Healthcare’s higher probable upside, research analysts clearly believe Alignment Healthcare is more favorable than Humana.
Profitability
This table compares Alignment Healthcare and Humana’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alignment Healthcare | N/A | N/A | N/A |
| Humana | 4.72% | 19.08% | 7.42% |
Summary
Humana beats Alignment Healthcare on 9 of the 11 factors compared between the two stocks.
About Alignment Healthcare
Alignment Healthcare, Inc. provides a consumer-centric platform that delivers customized health care to seniors in the United States. It offers medicare advantage plans and health plan options to its partners and patients with customized care and service; and preferred provider organization offerings. The company was founded in 2013 and is based in Orange, California.
About Humana
Humana Inc., together with its subsidiaries, operates as a health and well-being company in the United States. It operates through Retail, Group and Specialty, and Healthcare Services segments. The company offers medical and supplemental benefit plans to individuals. It also has a contract with Centers for Medicare and Medicaid Services to administer the Limited Income Newly Eligible Transition prescription drug plan program; and contracts with various states to provide Medicaid, dual eligible, and long-term support services benefits. In addition, the company provides commercial fully-insured medical and specialty health insurance benefits comprising dental, vision, and other supplemental health benefits; and administrative services only products to individuals and employer groups, as well as military services, such as TRICARE T2017 East Region contract. Further, it offers pharmacy solutions, provider services, predictive modeling and informatics services, and clinical care services, such as home health and other services to its health plan members, as well as to third parties. As of December 31, 2020, the company had approximately 17 million members in medical benefit plans, as well as approximately 5 million members in specialty products. Humana Inc. was incorporated in 1964 and is headquartered in Louisville, Kentucky.