Edwards Lifesciences Corporation (NYSE: EW) and ViewRay (NASDAQ:VRAY) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, risk, dividends, earnings and profitability.

Profitability

This table compares Edwards Lifesciences Corporation and ViewRay’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Edwards Lifesciences Corporation 22.16% 27.17% 15.91%
ViewRay -333.93% N/A -69.60%

Volatility & Risk

Edwards Lifesciences Corporation has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, ViewRay has a beta of -0.32, indicating that its stock price is 132% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Edwards Lifesciences Corporation and ViewRay, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Edwards Lifesciences Corporation 0 5 14 1 2.80
ViewRay 0 0 5 0 3.00

Edwards Lifesciences Corporation presently has a consensus target price of $120.05, indicating a potential upside of 8.94%. ViewRay has a consensus target price of $10.00, indicating a potential upside of 61.29%. Given ViewRay’s stronger consensus rating and higher probable upside, analysts plainly believe ViewRay is more favorable than Edwards Lifesciences Corporation.

Insider and Institutional Ownership

82.1% of Edwards Lifesciences Corporation shares are owned by institutional investors. Comparatively, 53.7% of ViewRay shares are owned by institutional investors. 2.1% of Edwards Lifesciences Corporation shares are owned by insiders. Comparatively, 62.8% of ViewRay shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Edwards Lifesciences Corporation and ViewRay’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Edwards Lifesciences Corporation $3.23 billion 7.20 $1.05 billion $3.30 33.39
ViewRay $18.41 million 19.87 -$43.16 million ($1.29) -4.81

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

Summary

Edwards Lifesciences Corporation beats ViewRay on 10 of the 14 factors compared between the two stocks.

About Edwards Lifesciences Corporation

Edwards Lifesciences Corporation is a manufacturer of heart valve systems and repair products used to replace or repair a patient’s diseased or defective heart valve. The Company is engaged in patient-focused innovations for structural heart disease and critical care monitoring. Its segments include United States, Europe, Japan and Rest of World. Its products are categorized into three areas: Transcatheter Heart Valve Therapy, Surgical Heart Valve Therapy and Critical Care. It also develops hemodynamic monitoring systems that are used to measure a patient’s cardiovascular function in the hospital setting. It is developing products, such as the Edwards SAPIEN 3 Ultra System and Edwards SAPIEN XT transcatheter heart valve, among others. Its Transcatheter Heart Valve Therapy and Surgical Heart Valve Therapy products are manufactured in the United States, Singapore and Switzerland. Critical Care products are manufactured in its facilities located in Puerto Rico and the Dominican Republic.

About ViewRay

ViewRay, Inc. designs, manufactures and markets MRIdian, the magnetic resonance imaging (MRI)-guided radiation therapy system to image and treat cancer patients simultaneously. The Company offers radiation therapy technology combined with magnetic resonance imaging. MRIdian integrates MRI technology, radiation delivery and the Company’s software to locate, target and track the position and shape of soft-tissue tumors while radiation is delivered. MRIdian delivers radiation to the tumor accurately while delivering less radiation to healthy tissue. MRIdian provides real-time imaging that defines the targeted tumor from the surrounding soft tissue and other critical organs during radiation treatment. MRIdian allows physicians to record the level of radiation exposure that the tumor has received and adapt the prescription between fractions as needed.

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