Sonova (OTCMKTS:SONVY) and Varian Medical Systems (NYSE:VAR) are both large-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, earnings, dividends and valuation.
Insider & Institutional Ownership
1.1% of Sonova shares are owned by institutional investors. Comparatively, 87.0% of Varian Medical Systems shares are owned by institutional investors. 0.8% of Varian Medical Systems shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Volatility and Risk
Sonova has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500. Comparatively, Varian Medical Systems has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Sonova and Varian Medical Systems, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Sonova | 0 | 6 | 3 | 0 | 2.33 |
Varian Medical Systems | 3 | 6 | 0 | 0 | 1.67 |
Varian Medical Systems has a consensus price target of $148.2778, suggesting a potential downside of 15.65%. Given Varian Medical Systems' higher possible upside, analysts plainly believe Varian Medical Systems is more favorable than Sonova.
Earnings and Valuation
This table compares Sonova and Varian Medical Systems' top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Sonova | $2.96 billion | 5.68 | $489.96 million | $1.49 | 34.98 |
Varian Medical Systems | $3.17 billion | 5.10 | $269.20 million | $3.91 | 44.96 |
Sonova has higher earnings, but lower revenue than Varian Medical Systems. Sonova 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.
Profitability
This table compares Sonova and Varian Medical Systems' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Sonova | N/A | N/A | N/A |
Varian Medical Systems | 8.50% | 18.45% | 8.08% |
Summary
Varian Medical Systems beats Sonova on 10 of the 14 factors compared between the two stocks.