Hill-Rom (NYSE: HRC) and Cardiovascular Systems (NASDAQ:CSII) are both medical companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.
Risk and Volatility
Hill-Rom has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500. Comparatively, Cardiovascular Systems has a beta of 2.53, meaning that its share price is 153% more volatile than the S&P 500.
This table compares Hill-Rom and Cardiovascular Systems’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Hill-Rom||$2.74 billion||2.08||$133.60 million||$1.99||43.61|
|Cardiovascular Systems||$204.91 million||4.12||-$1.79 million||($0.06)||-412.60|
Hill-Rom has higher revenue and earnings than Cardiovascular Systems. Cardiovascular Systems is trading at a lower price-to-earnings ratio than Hill-Rom, indicating that it is currently the more affordable of the two stocks.
Hill-Rom pays an annual dividend of $0.72 per share and has a dividend yield of 0.8%. Cardiovascular Systems does not pay a dividend. Hill-Rom pays out 36.2% of its earnings in the form of a dividend. Hill-Rom has raised its dividend for 7 consecutive years.
Institutional and Insider Ownership
82.3% of Hill-Rom shares are held by institutional investors. Comparatively, 74.9% of Cardiovascular Systems shares are held by institutional investors. 2.2% of Hill-Rom shares are held by company insiders. Comparatively, 3.3% of Cardiovascular Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for Hill-Rom and Cardiovascular Systems, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Hill-Rom presently has a consensus price target of $92.29, suggesting a potential upside of 6.33%. Cardiovascular Systems has a consensus price target of $31.50, suggesting a potential upside of 27.22%. Given Cardiovascular Systems’ higher probable upside, analysts plainly believe Cardiovascular Systems is more favorable than Hill-Rom.
This table compares Hill-Rom and Cardiovascular Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Hill-Rom beats Cardiovascular Systems on 11 of the 17 factors compared between the two stocks.
Hill-Rom Holdings, Inc. is a global medical technology company. The Company operates through four segments: North America Patient Support Systems, International Patient Support Systems, Front Line Care and Surgical Solutions. The Company’s products and services include Patient Support Systems, Front Line Care and Surgical Solutions. The Company sells and rents its specialty frames and surfaces, and mobility solutions, as well as its clinical workflow solutions, in the United States and Canada through its North America Patient Support Systems segment, and in regions outside of the United States and Canada through its International Patient Support Systems segment. Its Front Line Care segment globally sells and rents respiratory care products, and sells medical diagnostic equipment and a diversified portfolio of devices that assess, diagnose, treat and manage a range of illnesses and diseases. Under its Surgical Solutions segment, the Company sells its surgical products globally.
About Cardiovascular Systems
Cardiovascular Systems, Inc. is a medical technology company. The Company is engaged in treating patients suffering from peripheral and coronary artery diseases, including those with arterial calcium. The Company develops an orbital atherectomy technology for both peripheral and coronary commercial applications. Its peripheral artery disease (PAD) systems are catheter-based platforms capable of treating a range of plaque types in leg arteries both above and below the knee. Its products include Diamondback 360 Peripheral Orbital Atherectomy System (OAS) (Diamondback 360 Peripheral), the Stealth 360 OAS (Stealth 360), Diamondback 360 Peripheral, Diamondback 360 60cm Peripheral, Diamondback 360 Low Profile Peripheral, Diamondback 360 1.50 Peripheral and Diamondback 360 2.00 Peripheral. The Company’s coronary arterial disease (CAD) product, Diamondback 360 Coronary OAS (Coronary OAS), is marketed as a treatment for severely calcified coronary arteries.
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