Healthcare Services Group's Earnings in Line, Div Hiked - Analyst Blog

Healthcare Services Group, Inc.  HCSG reported earnings of 21 cents per share in the first quarter of 2014, in line with the Zacks Consensus Estimate. Results, however, were a penny short of the comparable year-ago number.

Behind the Headlines

Total revenue grossed $312.2 million in the quarter, improving 14% year over year but missing the Zacks Consensus Estimate of $314 million.

While cost of services provided escalated 14%, selling, general and administrative expenses rose 5.8% year over year.

Though expenses climbed up, a higher magnitude of revenue increase drove an improvement in income from operations that increased about 27% year over year to $22.7 million in the reported quarter.

Financial Update

Healthcare Services Group exited first-quarter 2014 with cash and cash equivalents of $71.7 million, which grew 11.7% from $64.2 million as of Dec 31, 2012.

At the end of the first quarter, total asset improved 3.7% to $441 million over $425.3 million as of 2013-end.  

Stockholders' equity of $293.8 million at the end of the quarter was 3.1% higher than $285.1 million at the end of 2013.

Dividend Update

The Board of Directors declared a quarterly cash dividend of 17.250 cents per share, reflecting about 1.5% increase over the last payout. The dividend will be paid on June 27, 2014 to shareholders of record on May 23, 2014.

This increase represents the 44th consecutive quarterly cash dividend payment, as well as the 43rd consecutive increase since Healthcare Services Group's initiation of quarterly cash dividend payments in 2003.

Zacks Rank

Healthcare Services Group presently carries a Zacks Rank #3 (Hold). Other better-ranked stocks worth reckoning are Odyssey Marine Exploration Inc. OMEX, Rentrak Corporation RENT and SouFun Holdings Ltd. SFUN. All these sport a Zacks Rank #1 (Strong Buy).