Varian Medical Systems (NYSE:VAR) and Becton, Dickinson and (NYSE:BDX) are both large-cap medical companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.
Risk and Volatility
Varian Medical Systems has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, Becton, Dickinson and has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent recommendations for Varian Medical Systems and Becton, Dickinson and, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Varian Medical Systems | 3 | 6 | 0 | 0 | 1.67 |
| Becton, Dickinson and | 0 | 7 | 7 | 0 | 2.50 |
Varian Medical Systems currently has a consensus target price of $148.2778, indicating a potential downside of 15.43%. Becton, Dickinson and has a consensus target price of $279.6667, indicating a potential upside of 7.46%. Given Becton, Dickinson and's stronger consensus rating and higher possible upside, analysts plainly believe Becton, Dickinson and is more favorable than Varian Medical Systems.
Profitability
This table compares Varian Medical Systems and Becton, Dickinson and's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Varian Medical Systems | 8.50% | 18.45% | 8.08% |
| Becton, Dickinson and | 5.11% | 13.30% | 5.60% |
Insider and Institutional Ownership
87.0% of Varian Medical Systems shares are held by institutional investors. Comparatively, 83.2% of Becton, Dickinson and shares are held by institutional investors. 0.8% of Varian Medical Systems shares are held by insiders. Comparatively, 0.8% of Becton, Dickinson and shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Varian Medical Systems and Becton, Dickinson and's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Varian Medical Systems | $3.17 billion | 5.06 | $269.20 million | $3.91 | 44.84 |
| Becton, Dickinson and | $17.12 billion | 4.42 | $874 million | $10.20 | 25.51 |
Becton, Dickinson and has higher revenue and earnings than Varian Medical Systems. Becton, Dickinson and is trading at a lower price-to-earnings ratio than Varian Medical Systems, indicating that it is currently the more affordable of the two stocks.
