Inspire Medical Systems (NYSE:INSP – Get Free Report) and Pulmonx (NASDAQ:LUNG – Get Free Report) are both medical companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, valuation and earnings.
Analyst Ratings
This is a breakdown of current ratings and target prices for Inspire Medical Systems and Pulmonx, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Inspire Medical Systems | 1 | 7 | 7 | 0 | 2.40 |
| Pulmonx | 1 | 4 | 5 | 0 | 2.40 |
Inspire Medical Systems presently has a consensus target price of $154.43, indicating a potential upside of 101.75%. Pulmonx has a consensus target price of $7.66, indicating a potential upside of 316.54%. Given Pulmonx’s higher possible upside, analysts clearly believe Pulmonx is more favorable than Inspire Medical Systems.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Inspire Medical Systems | $802.80 million | 2.82 | $53.51 million | $1.73 | 44.25 |
| Pulmonx | $83.79 million | 0.89 | -$56.39 million | ($1.43) | -1.29 |
Inspire Medical Systems has higher revenue and earnings than Pulmonx. Pulmonx is trading at a lower price-to-earnings ratio than Inspire Medical Systems, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Inspire Medical Systems has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500. Comparatively, Pulmonx has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500.
Profitability
This table compares Inspire Medical Systems and Pulmonx’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Inspire Medical Systems | 6.17% | 10.38% | 8.93% |
| Pulmonx | -62.88% | -69.76% | -36.26% |
Insider & Institutional Ownership
94.9% of Inspire Medical Systems shares are owned by institutional investors. Comparatively, 91.0% of Pulmonx shares are owned by institutional investors. 4.1% of Inspire Medical Systems shares are owned by insiders. Comparatively, 6.8% of Pulmonx shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Summary
Inspire Medical Systems beats Pulmonx on 11 of the 13 factors compared between the two stocks.
About Inspire Medical Systems
Inspire Medical Systems, Inc., a medical technology company, focuses on the development and commercialization of minimally invasive solutions for patients with obstructive sleep apnea (OSA) in the United States and internationally. The company offers Inspire system, a neurostimulation technology that provides a safe and effective treatment for moderate to severe OSA. It also develops a novel, closed-loop solution that continuously monitors a patient's breathing and delivers mild hypoglossal nerve stimulation to maintain an open airway. The company was incorporated in 2007 and is headquartered in Golden Valley, Minnesota.
About Pulmonx
Pulmonx Corporation, a commercial-stage medical technology company, provides minimally invasive devices for the treatment of chronic obstructive pulmonary diseases. The company offers Zephyr Endobronchial Valve, a solution for the treatment of patients with hyperinflation associated with severe emphysema; and Chartis Pulmonary Assessment System, a balloon catheter and console system with flow and pressure sensors that are used to assess the presence of collateral ventilation. It also offers StratX Lung Analysis Platform, a cloud-based quantitative computed tomography analysis service that offers information on emphysema destruction, fissure completeness, and lobar volume to help identify target lobes for the treatment with Zephyr Valves. The company serves emphysema patients in the United States, Europe, the Middle East, Africa, the Asia-Pacific, and internationally. The company was formerly known as Pulmonx and changed its name to Pulmonx Corporation in December 2013. Pulmonx Corporation was incorporated in 1995 and is headquartered in Redwood City, California.
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