Daily Stock Pick: Healthcare Services Group

A portfolio of stocks I've been building since September 3 is named Volio Folio. It will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!

I'm reviewing today the first of five industrials stocks striving to be picked to join the Volio folio collection. This would be the sixth pick for Volio!

That industrials sector includes twenty-three industries all related to designing, fabricating and servicing stuff we want and use. The industrials industries range from aerospace and defense to waste management with all the transportation, business services, and equipment required in between.

My subject today is a small cap business services entity named Healthcare Services Group Inc. Their trading ticker symbol is HCSG. This is my first report on HCSG.

Healthcare Services Group Inc is a provider of housekeeping and facility management services to the healthcare industry.

The company operates two business segments: housekeeping and dietary. Housekeeping includes management of clients' housekeeping departments, cleaning, disinfecting and sanitizing, laundry, and bed linen and uniform services. Dietary consists of food purchasing, meal preparation, and providing dietitian consulting services.

Clients are primarily nursing homes, retirement complexes, rehabilitation centers, and hospitals in the United States of America.

As of December 31, 2018, the company provided its services to 3,500 facilities.

Healthcare Services Group, Inc. was founded in 1976 and is based in Bensalem, Pennsylvania.

I use three key data points to gauge dividend-paying equities or funds like Healthcare Services Group Inc. (HCSG):

(1) Price

(2) Dividends

(3) Returns

Besides those three, several other keys will finally unlock an equity or fund in which to invest, or not.

Those three basic keys, however, best tell whether a company has made, is making, and will make money.

HCSG Price

HCSG's price per share closed at $23.98 yesterday. A year ago its price was $40.13. So, in the past year, its price dropped $16.15 or 40.24%.

Assuming HCSG's stock trades in the range of $22.00 to $40.00 this next year, HCSG's recent $23.98 price could rise by $6.02 and get to $30.00 by early October 2020, if upward momentum takes charge.

HCSG Dividends

HCSG's latest declared quarterly dividend was $0.20, payable September 27th.

That $0.20 Q dividend equates to $0,80 annually and yields 3.32% based on yesterday's $23.98 closing price.

HCSG Gains?

Adding the $0.80 annual estimated dividend to my $6.02 estimate ofHCSG's price upside shows a $6.82 potential gross gain, per share, which will be reduced by costs to trade these shares.

Say we put a little over $1,000.00 today into Healthcare Services Group at its recent $23.98 price, we'd buy 42 shares of HCSG.

A $10 broker fee paid half at purchase and half at sale will cost us about $0.24 per share.

Subtract that $0.24 brokerage cost from the estimated $6.82 gross estimated gain leaves a net gain of $6.58 X 42 shares = $276.36 or a 27.6% net gain on a $1,007.16 investment.

Therefore, Healthcare Services Group, whose trading ticker symbol is HCSG now shows a possible net gain of 27.6% including a 3.32% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. The actual results remain to be seen to learn if Healthcare Services Group Inc. (HCSG) is worth your time and money.

Disclosure: This article was compiled by Rydlun & Co., LLC from data derived from www.ycharts. com; www.finance.yahoo.com; analyst median target price by YCharts.

Catch Your Underdog Daily ...

more
How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.