Irhythm Technologies (NASDAQ:IRTC) and Stryker (NYSE:SYK) are both medical companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, dividends, earnings and risk.

Volatility & Risk

Irhythm Technologies has a beta of 1.8, indicating that its share price is 80% more volatile than the S&P 500. Comparatively, Stryker has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Insider and Institutional Ownership

71.0% of Stryker shares are held by institutional investors. 3.1% of Irhythm Technologies shares are held by company insiders. Comparatively, 6.8% of Stryker 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.

Analyst Ratings

This is a summary of recent recommendations and price targets for Irhythm Technologies and Stryker, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Irhythm Technologies 0 2 10 0 2.83
Stryker 2 8 16 1 2.59

Irhythm Technologies currently has a consensus target price of $183.11, suggesting a potential downside of 19.40%. Stryker has a consensus target price of $217.92, suggesting a potential upside of 0.98%. Given Stryker’s higher probable upside, analysts clearly believe Stryker is more favorable than Irhythm Technologies.

Profitability

This table compares Irhythm Technologies and Stryker’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Irhythm Technologies -28.50% -50.23% -22.26%
Stryker 11.38% 20.53% 8.89%

Valuation & Earnings

This table compares Irhythm Technologies and Stryker’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Irhythm Technologies $214.55 million 29.02 -$54.57 million ($2.16) -105.18
Stryker $14.88 billion 5.43 $2.08 billion $8.26 26.13

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

Summary

Stryker beats Irhythm Technologies on 12 of the 15 factors compared between the two stocks.

Irhythm Technologies Company Profile

iRhythm Technologies, Inc., a digital healthcare company, provides ambulatory electrocardiogram (ECG) monitoring products for patients at risk for arrhythmias in the United States. The company offers Zio service, an ambulatory cardiac monitoring solution that combines a wire-free, patch-based, and wearable biosensor with a cloud-based data analytic platform to help physicians to monitor patients and diagnose arrhythmias. Its Zio XT monitor, a single-use, wire-free, and wearable patch-based biosensor, records patient's heartbeats and ECG data. The company was founded in 2006 and is headquartered in San Francisco, California.

Stryker Company Profile

Stryker Corporation operates as a medical technology company. The company operates through three segments: Orthopaedics, MedSurg, and Neurotechnology and Spine. The Orthopaedics segment provides implants for use in hip and knee joint replacements, and trauma and extremities surgeries. The MedSurg segment offers surgical equipment and surgical navigation systems, endoscopic and communications systems, patient handling, emergency medical equipment and intensive care disposable products, reprocessed and remanufactured medical devices, and other medical devices for use in various medical specialties. The Neurotechnology and Spine segment provides neurotechnology products that include products used for minimally invasive endovascular techniques; products for brain and open skull based surgical procedures; orthobiologic and biosurgery products, such as synthetic bone grafts and vertebral augmentation products; and minimally invasive products for the treatment of acute ischemic and hemorrhagic stroke. It also provides spinal implant products comprising cervical, thoracolumbar, and interbody systems for use in spinal injury, deformity, and degenerative therapies. The company sells its products to doctors, hospitals, and other healthcare facilities through company-owned subsidiaries and branches, as well as third-party dealers and distributors in approximately 80 countries. Stryker Corporation was founded in 1941 and is headquartered in Kalamazoo, Michigan.

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