Analyzing iRhythm Technologies (NASDAQ:IRTC) & Intuitive Surgical (NASDAQ:ISRG)

Intuitive Surgical (NASDAQ:ISRG) and iRhythm Technologies (NASDAQ:IRTC) are both healthcare companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, earnings, institutional ownership, profitability and dividends.

Profitability

This table compares Intuitive Surgical and iRhythm Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Intuitive Surgical	28.45%	16.91%	14.83%
iRhythm Technologies	-1.69%	10.11%	1.53%

Insider and Institutional Ownership

83.6% of Intuitive Surgical shares are held by institutional investors. 0.6% of Intuitive Surgical shares are held by company insiders. Comparatively, 1.0% of iRhythm Technologies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Intuitive Surgical and iRhythm Technologies”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Intuitive Surgical	$10.06 billion	13.98	$2.86 billion	$8.73	45.62
iRhythm Technologies	$825.34 million	4.46	-$44.55 million	($0.43)	-259.88

Intuitive Surgical has higher revenue and earnings than iRhythm Technologies. iRhythm Technologies is trading at a lower price-to-earnings ratio than Intuitive Surgical, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Intuitive Surgical has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500. Comparatively, iRhythm Technologies has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Intuitive Surgical and iRhythm Technologies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Intuitive Surgical	1	8	22	0	2.68
iRhythm Technologies	1	1	12	2	2.94

Intuitive Surgical currently has a consensus target price of $508.68, suggesting a potential upside of 27.71%. iRhythm Technologies has a consensus target price of $179.93, suggesting a potential upside of 61.01%. Given iRhythm Technologies’ stronger consensus rating and higher probable upside, analysts clearly believe iRhythm Technologies is more favorable than Intuitive Surgical.

Summary

Intuitive Surgical beats iRhythm Technologies on 11 of the 15 factors compared between the two stocks.

About Intuitive Surgical

Intuitive Surgical, Inc. develops, manufactures, and markets products that enable physicians and healthcare providers to enhance the quality of and access to minimally invasive care in the United States and internationally. The company offers the da Vinci Surgical System that enables complex surgery using a minimally invasive approach; and Ion endoluminal system, which extends its commercial offerings beyond surgery into diagnostic procedures enabling minimally invasive biopsies in the lung. It also provides a suite of stapling, energy, and core instrumentation for its multi-port da Vinci surgical systems; progressive learning pathways to support the use of its technology; infrastructure of service and support specialists, a complement of services to its customers, including installation, repair, maintenance, 24/7 technical support, and proactive system health monitoring; and integrated digital capabilities providing connected offerings, streamlining performance for hospitals with program-enhancing insights. The company sells its products through direct sales organizations, such as capital and clinical sales teams. It has a collaboration agreement with FluoGuide A/S for head & neck cancer. The company was incorporated in 1995 and is headquartered in Sunnyvale, California.

About iRhythm Technologies

iRhythm Technologies, Inc., a digital healthcare company, engages in the design, development, and commercialization of device-based technology to provide ambulatory cardiac monitoring services to diagnose arrhythmias in the United States. It offers Zio services, an ambulatory monitoring solution, including long-term and short-term continuous monitoring and mobile cardiac telemetry monitoring services. The company also provides the Zio Monitor System, a prescription-only, remote electrocardiogram (ECG) monitoring system that consists of a patch ECG monitor that records the electric signal from the heart continuously for up to 14 days and the Zio ECG Utilization Software System, which supports the capture and analysis of ECG data recorded by the Zio Monitor patch at the end of the wear period, including specific arrhythmia events detected by the ZEUS System; the Zio XT System is the previous generation of the Zio Monitor System and is a prescription-only, remote ECG monitoring system that consists of the Zio XT patch that records the electric signal from the heart continuously for up to 14 days; and the Zio AT system, a prescription-only, remote ECG monitoring system that similarly consists of the Zio AT patch that records the electric signal from the heart continuously for up to 14 days and the ZEUS System, but which also incorporates the Zio AT wireless gateway that provides connectivity between the Zio AT patch and the ZEUS System during the patient wear period. It has a development collaboration agreement with Verily Life Sciences LLC and Verity Ireland Limited to develop various next-generation atrial fibrillation screening, detection, or monitoring products. The company was incorporated in 2006 and is headquartered in San Francisco, California.