Divineimpetus

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**please take this with a grain of salt, and read for pleasure**

How much are you worth?

I was interested in finding out how much I would be worth if I became a dentist. So I decided to do what ever one does when they have a question-look it up on google. So I googled for two things, first a public traded company that runs dental practices (like trying to find your local gentle dental on the new york stock exchange) and two, once I found that company use google finance to answer how much that company is worth.

I found American Dental Partners, Inc (ADPI) which according to google is –

“American Dental Partners, Inc. is a provider of business services to multi-disciplinary dental group practices in selected markets throughout the United States. The Company acquires selected assets of the dental practices with which it affiliates and enters into long-term service agreements with the affiliated practices. American Dental Partners is responsible for providing all services necessary for the administration of the non-clinical aspects of the dental operations. Services provided to the affiliated practices include assistance with organizational planning and development; recruiting, retention and training programs; quality assurance initiatives; facilities development and management; employee benefits administration; procurement; information systems; marketing and payer relations, and financial planning, reporting and analysis. As of December 31, 2005, the Company was affiliated with 19 dental group practices operating 187 dental facilities in 18 states.”

Essentially, they buyout dental practices and use their business acumen to make them run better.


This data has been taken from google (finance.google.com) or from American Dental Partner’s website (http://www.amdpi.com/pdf/adp_2005_annual_report.pdf)


According to the 2005 Annual Report

They had 435 Full Time Dentists (some dentists are also specialists)
It would cost $262.62 million to buy the company in terms of market capitalization**current as of 2/6/07 not of the time the annual report was released)
The net earnings was $10,291,000 dollars (that’s after paying all your expenses including salary)


So how much would it cost to buy a dentist?

262,620,000/436 = $602,339 – of course these are super dentists, because this is independent on how many dental assistants, hygienist or office workers there are; or even the professional business acumen that is help running the company. These are also not slave dentists; you don’t get to buy them for $602,339 and keep their salary. Although, if you bought one of these dentists how much money would you be earning? Let’s see….

There are 435 dentists and the company’s net earnings are $10,291,000 so that means, each of these super dentists generates $23,650. Which is pretty bad since, it cost you $602,339 to buy a dentist, and you only get $23,650 back – that’s only 3.92% My money market accounts gives me 4.5% and that’s FDIC insured.

This sound like some over priced super dentist to me, but let’s try something else. Instead of investing $200,000 into dental school through student loans, let’s take that $200,000 and buy stock (dentists) from American Dental Partners.

Let’s take a usual 4 year program, starts in August 2001 and ends in May 2005. The market cap of American Dental Partners (ADPI) was $52,940,000. .I’m going to use the same figures in 2005, of course 2001 is smaller (358 dentist and 3,721 net earnings; but I’m doing an “if”)

That means each dentist would then cost me.

52,940,000/435 = $121,701.14 (nice cheap dentists…)

That means with my $200,000 I can buy (200,000/121,701) 1.6 dentists! Woot!

And since each dentists makes me $23,650, that means I would make $38,865 doing nothing! I wouldn’t even have to wake up at 8:00 in the morning to get ready for work.


Of course, all of this doesn’t mean much. For one, no one will give me $200,000 to buy stock in ADPI to buy “super-dentists”, and if they did, ADPI isn’t going to give me their net earnings to me unless they declare a dividend (which they haven’t)

Anyways, some interesting numbers (although, the numbers are riddled with inequities)…kind of funny to think of a dentist worth $121,000 or $600,000 for that matter.

Is dental school still worth the $200,000+ in debt, slave conditions for 4 years (first two being hell) and the fact you will personally have to work or is buying dentists through the NASDAQ a better option?
 
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