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Jeff Ross, MD
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Founder, CEO and managing director of Vailshire Capital Management, LLC, in Colorado Springs. Managing director of Vailshire Partners, LP: a multi-strategy "two-pronged" hedge fund seeking present value, future growth, and current income through an active safe options strategy. The... More
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  • Grow Wealthy As The Baby Boomers Grow Old: A Look At Healthcare Services Group 0 comments
    Oct 14, 2012 8:22 AM | about stocks: HCSG

    Could there be a less-exciting, more yawn-invoking company to own than a business specializing in providing nursing homes, rehab centers & hospitals with housekeeping, laundry & dietary services? Probably not. So let me enthusiastically introduce you to Healthcare Services Group, Inc. (NASDAQ:HCSG)!

    It's no secret that the Baby Boomers are the largest U.S. demographic and that they are now reaching retirement age. And with age comes a significantly increased need for health care and basic "daily living" services. Putting two and two together, I see a four-letter stock ticker: HCSG.

    Year-over-year quarterly revenue and earnings growth have increased by 25% and 15%, respectively. A return on assets of 13% and return on equity of 19% are nothing to sneeze at. Gesundheit!

    In addition, HCSG provides a forward dividend of $0.66, yielding around 3% at current stock prices. HCSG has paid an increasing dividend for 8 years, with a 5 year dividend growth rate of 25% (as of 4/15/12).

    In my view, HCSG is a fantastically-boring stock that treats shareholders well and will almost certainly continue doing so. And, with the aging of our Baby Boomers (God bless 'em), this stock has nowhere to go but up.

    Disclosure: I am long HCSG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Additional disclosure: I am a practicing physician.

    Themes: long-ideas Stocks: HCSG
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