We assign a fundamental rating of 6 out of 10 to THC. THC was compared to 103 industry peers in the Health Care Providers & Services industry. THC scores excellent on profitability, but there are some minor concerns on its financial health. THC may be a bit undervalued, certainly considering the very reasonable score on growth These ratings would make THC suitable for value investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year THC was profitable.
THC had a positive operating cash flow in the past year.
In the past 5 years THC has always been profitable.
THC had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

THC's Return On Assets of 4.60% is fine compared to the rest of the industry. THC outperforms 74.76% of its industry peers.
THC has a Return On Equity of 33.73%. This is amongst the best in the industry. THC outperforms 94.17% of its industry peers.
THC's Return On Invested Capital of 11.65% is amongst the best of the industry. THC outperforms 85.44% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for THC is in line with the industry average of 9.16%.
The 3 year average ROIC (9.25%) for THC is below the current ROIC(11.65%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	4.6%
ROE	33.73%
ROIC	11.65%

ROA(3y)4.91%

ROA(5y)3.9%

ROE(3y)50.24%

ROE(5y)332.92%

ROIC(3y)9.25%

ROIC(5y)8.01%

1.3 Margins

THC has a Profit Margin of 6.49%. This is amongst the best in the industry. THC outperforms 84.47% of its industry peers.
THC's Profit Margin has improved in the last couple of years.
THC has a better Operating Margin (17.52%) than 96.12% of its industry peers.
THC's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 82.26%, THC belongs to the best of the industry, outperforming 96.12% of the companies in the same industry.
In the last couple of years the Gross Margin of THC has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	17.52%
PM (TTM)	6.49%
GM	82.26%

OM growth 3Y10.99%

OM growth 5Y11.36%

PM growth 3Y48.9%

PM growth 5YN/A

GM growth 3Y-0.23%

GM growth 5Y-0.27%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), THC is creating some value.
The number of shares outstanding for THC has been reduced compared to 1 year ago.
THC has less shares outstanding than it did 5 years ago.
The debt/assets ratio for THC has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 1.84 indicates that THC is not a great score, but indicates only limited risk for bankruptcy at the moment.
THC has a Altman-Z score (1.84) which is in line with its industry peers.
The Debt to FCF ratio of THC is 8.78, which is on the high side as it means it would take THC, 8.78 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of THC (8.78) is comparable to the rest of the industry.
THC has a Debt/Equity ratio of 3.26. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of THC (3.26) is worse than 74.76% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	3.26
Debt/FCF	8.78
Altman-Z	1.84

ROIC/WACC1.34

WACC8.67%

2.3 Liquidity

THC has a Current Ratio of 1.71. This is a normal value and indicates that THC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.71, THC is in the better half of the industry, outperforming 67.96% of the companies in the same industry.
A Quick Ratio of 1.64 indicates that THC should not have too much problems paying its short term obligations.
THC has a better Quick ratio (1.64) than 66.02% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.71
Quick Ratio	1.64

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 39.32% over the past year.
Measured over the past years, THC shows a very strong growth in Earnings Per Share. The EPS has been growing by 34.84% on average per year.
The Revenue has decreased by -0.56% in the past year.
The Revenue has been growing slightly by 2.26% on average over the past years.

EPS 1Y (TTM)39.32%

EPS 3Y16.22%

EPS 5Y34.84%

EPS Q2Q%26.28%

Revenue 1Y (TTM)-0.56%

Revenue growth 3Y1.98%

Revenue growth 5Y2.26%

Sales Q2Q%3.26%

3.2 Future

The Earnings Per Share is expected to grow by 13.65% on average over the next years. This is quite good.
THC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.27% yearly.

EPS Next Y36.74%

EPS Next 2Y17.92%

EPS Next 3Y15.45%

EPS Next 5Y13.65%

Revenue Next Year2.31%

Revenue Next 2Y3.3%

Revenue Next 3Y3.83%

Revenue Next 5Y3.27%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

THC is valuated correctly with a Price/Earnings ratio of 12.21.
Based on the Price/Earnings ratio, THC is valued cheaper than 83.50% of the companies in the same industry.
When comparing the Price/Earnings ratio of THC to the average of the S&P500 Index (28.39), we can say THC is valued rather cheaply.
THC is valuated reasonably with a Price/Forward Earnings ratio of 11.45.
Compared to the rest of the industry, the Price/Forward Earnings ratio of THC indicates a rather cheap valuation: THC is cheaper than 85.44% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of THC to the average of the S&P500 Index (25.72), we can say THC is valued rather cheaply.

		Industry Rank	Sector Rank
PE	12.21
Fwd PE	11.45

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, THC is valued cheaper than 90.29% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of THC indicates a rather cheap valuation: THC is cheaper than 82.52% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	11.09
EV/EBITDA	6

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
THC has an outstanding profitability rating, which may justify a higher PE ratio.
THC's earnings are expected to grow with 15.45% in the coming years. This may justify a more expensive valuation.