IRIDEX (NASDAQ:IRIX – Get Free Report) and Medtronic (NYSE:MDT – Get Free Report) are both healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.
Risk and Volatility
IRIDEX has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500. Comparatively, Medtronic has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.
Profitability
This table compares IRIDEX and Medtronic’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| IRIDEX | -6.88% | N/A | -12.55% |
| Medtronic | 13.93% | 14.78% | 7.97% |
Valuation & Earnings
This table compares IRIDEX and Medtronic”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| IRIDEX | $52.67 million | 0.24 | -$4.44 million | ($0.20) | -3.60 |
| Medtronic | $37.54 billion | 3.46 | $4.80 billion | $4.06 | 25.02 |
Medtronic has higher revenue and earnings than IRIDEX. IRIDEX is trading at a lower price-to-earnings ratio than Medtronic, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings for IRIDEX and Medtronic, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| IRIDEX | 1 | 0 | 1 | 0 | 2.00 |
| Medtronic | 1 | 9 | 18 | 0 | 2.61 |
IRIDEX currently has a consensus price target of $3.00, suggesting a potential upside of 316.67%. Medtronic has a consensus price target of $102.88, suggesting a potential upside of 1.26%. Given IRIDEX’s higher probable upside, research analysts plainly believe IRIDEX is more favorable than Medtronic.
Insider & Institutional Ownership
20.1% of IRIDEX shares are held by institutional investors. Comparatively, 82.1% of Medtronic shares are held by institutional investors. 8.6% of IRIDEX shares are held by company insiders. Comparatively, 0.3% of Medtronic shares are held by company 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
Medtronic beats IRIDEX on 11 of the 14 factors compared between the two stocks.
About IRIDEX
IRIDEX Corporation (NASDAQ: IRIX) develops, manufactures and sells laser-based medical systems and disposable devices used in ophthalmic procedures. Its technologies are designed to help eye-care professionals treat glaucoma, retinal diseases and other conditions affecting vision. The company’s product portfolio includes the Cyclo Glaucoma Laser System, which uses MicroPulse and continuous-wave laser technology for glaucoma treatment, as well as laser systems such as the IRIDEX IQ series for retinal and photocoagulation procedures.
About Medtronic
Medtronic plc is a medical technology company that develops and manufactures devices and therapies for a range of health conditions. Its products include pacemakers and defibrillators, heart valves, surgical technologies, neurostimulation devices, and insulin pumps and other diabetes-management products. The company was founded in Minneapolis in 1949 by Earl Bakken and Palmer Hermundslie as a medical equipment repair business. It has since grown into a global company serving patients and health care providers in more than 150 countries.
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