Illumina (NASDAQ: ILMN) and IRIDEX Corporation (NASDAQ:IRIX) are both medical companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Risk and Volatility

Illumina has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500. Comparatively, IRIDEX Corporation has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500.

Insider & Institutional Ownership

93.3% of Illumina shares are owned by institutional investors. Comparatively, 47.5% of IRIDEX Corporation shares are owned by institutional investors. 1.6% of Illumina shares are owned by company insiders. Comparatively, 5.0% of IRIDEX Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Illumina and IRIDEX Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Illumina 2 8 9 0 2.37
IRIDEX Corporation 0 0 1 0 3.00

Illumina presently has a consensus target price of $173.56, indicating a potential downside of 17.23%. IRIDEX Corporation has a consensus target price of $20.00, indicating a potential upside of 123.71%. Given IRIDEX Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe IRIDEX Corporation is more favorable than Illumina.

Profitability

This table compares Illumina and IRIDEX Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Illumina 30.27% 19.69% 10.81%
IRIDEX Corporation -37.62% -16.87% -13.86%

Earnings and Valuation

This table compares Illumina and IRIDEX Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Illumina $2.49 billion 12.29 $666.78 million $5.10 41.11
IRIDEX Corporation $42.80 million 2.42 -$5.81 million ($1.51) -5.92

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

Summary

Illumina beats IRIDEX Corporation on 9 of the 13 factors compared between the two stocks.

About Illumina

Illumina, Inc. (Illumina) is a provider of sequencing- and array-based solutions for genetic analysis. The Company operates through two segments: Core Illumina and the consolidated variable interest entities (VIEs), which include the activities of GRAIL, Inc. (GRAIL) and Helix Holdings I, LLC (Helix). Core Illumina consists of its core operations. Core Illumina’s products and services serve customers in the research, clinical and applied markets, and enable the adoption of a range of genomic solutions. The Company’s portfolio of integrated systems, consumables and analysis tools addresses the range of genomic complexity, price points, and throughput, enabling customers to select the solution for their research or clinical challenge. The Company provides reproductive-health solutions, including noninvasive prenatal testing (NIPT), preimplantation genetic screening and diagnosis, and neonatal and genetic health testing.

About IRIDEX Corporation

IRIDEX Corporation is a provider of therapeutic based laser consoles, delivery devices and consumable instrumentation used to treat sight-threatening eye diseases in ophthalmology. The Company operates through ophthalmology segment. Its ophthalmology products consist of laser consoles, delivery devices and consumable instrumentation, including laser probes, and are used in the treatment of serious eye diseases, including the over three causes of irreversible blindness, such as diabetic retinopathy, glaucoma and age-related macular degeneration (AMD). In addition, the Company’s ophthalmology products are often used in vitrectomy procedures (used to treat proliferative diabetic retinopathy, macular holes, retinal tears and detachments), which are generally performed in the operating room and require a consumable single use intraocular laser probe (EndoProbe) to deliver light to the back of the eye together with other instrumentation.

Receive News & Ratings for Illumina Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Illumina Inc. and related companies with MarketBeat.com's FREE daily email newsletter.