Financial Analysis: Quality Systems (QSII) versus Streamline Health Solutions (STRM)

Quality Systems (NASDAQ: QSII) and Streamline Health Solutions (NASDAQ:STRM) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, risk, valuation, analyst recommendations, institutional ownership and dividends.

Analyst Ratings

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This is a summary of current recommendations for Quality Systems and Streamline Health Solutions, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quality Systems 3 6 1 0 1.80
Streamline Health Solutions 0 0 0 0 N/A



Quality Systems presently has a consensus price target of $14.44, suggesting a potential upside of 2.32%. Given Quality Systems’ higher possible upside, analysts clearly believe Quality Systems is more favorable than Streamline Health Solutions.

Insider & Institutional Ownership

71.3% of Quality Systems shares are owned by institutional investors. Comparatively, 35.4% of Streamline Health Solutions shares are owned by institutional investors. 17.9% of Quality Systems shares are owned by company insiders. Comparatively, 26.1% of Streamline Health Solutions shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Quality Systems and Streamline Health Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quality Systems 3.39% 12.08% 7.79%
Streamline Health Solutions -16.88% -40.97% -10.96%

Valuation & Earnings

This table compares Quality Systems and Streamline Health Solutions’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Quality Systems $509.62 million 1.76 $18.24 million $0.74 19.07
Streamline Health Solutions $27.06 million 1.16 -$5.16 million ($0.31) -5.06

Quality Systems has higher revenue and earnings than Streamline Health Solutions. Streamline Health Solutions is trading at a lower price-to-earnings ratio than Quality Systems, indicating that it is currently the more affordable of the two stocks.

Summary

Quality Systems beats Streamline Health Solutions on 11 of the 12 factors compared between the two stocks.

Quality Systems Company Profile

Quality Systems, Inc., together with its subsidiaries, develops and markets software and services that automate various aspects of practice management (PM) and electronic health records for medical and dental practices in the United States. The company's NextGen division provides integrated clinical, financial, and connectivity solutions for ambulatory and dental provider organizations. Its principal products include the NextGen Ambulatory product suite; interoperability solutions; and MediTouch, a cloud-based software suite comprising clearinghouse, PM, electronic health records, and patient portals, which enable mobility, workflow automation, and reporting and analytics. Its RCM Services Division offers technology-based solutions that are designed to optimize clients' revenue cycle costs and process efficiency, as well as to enhance clients' cash flow. This division provides revenue cycle management optimization services; and billing and collections, claims submissions and reconciliation, electronic remittance and payment posting, accounts receivable management, patient client service, advance analytics, charge entry and capture, enrollment credentialing, and software setup, hosting, and support services. The company's QSI Dental division focuses on developing, marketing, and supporting software suites for dental group organizations. This division also offers QSIDental Web, a cloud-based and software as a service and PM clinical software solution; and sells licenses to its products. The company also provides software implementation, training, support, and maintenance services; and electronic data interchange services. It serves single and small practice physicians, physician hospital organizations, management service organizations, accountable care organizations, ambulatory care centers, community health centers, and medical and dental schools through a sales force and a reseller channel. The company was founded in 1974 and is headquartered in Irvine, California.

Streamline Health Solutions Company Profile

Streamline Health Solutions, Inc. provides health information technology solutions and services for hospitals and health systems in the United States and Canada. It offers computer software-based solutions through its Looking Glass platform, which captures, aggregates, and translates structured and unstructured data to deliver predictive insights to its clients. The company also provides patient care solutions that enable healthcare providers to enhance their patient care through individual workflows comprising clinical analytics, operating room management, physician portal, and care coordination; and health information management, coding, and clinical documentation improvement (CDI) solutions, which include Web-based software solutions, such as content management, release of information, computer-assisted coding, CDI, abstracting, and physician query. In addition, the company provides financial management solutions, including accounts receivable management, denials management, claims processing, spend management, and audit management; and custom integration, training, electronic image conversion, audit, and database monitoring services. It sells its solutions and services through direct sales force and reseller partnerships. Streamline Health Solutions, Inc. was founded in 1989 and is based in Atlanta, Georgia.

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