ViewRay (NASDAQ: VRAY) and ABIOMED (NASDAQ:ABMD) are both medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for ViewRay and ABIOMED, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ViewRay 0 0 5 0 3.00
ABIOMED 0 2 6 0 2.75

ViewRay presently has a consensus target price of $10.00, suggesting a potential upside of 49.25%. ABIOMED has a consensus target price of $174.71, suggesting a potential upside of 0.05%. Given ViewRay’s stronger consensus rating and higher probable upside, equities research analysts plainly believe ViewRay is more favorable than ABIOMED.

Insider and Institutional Ownership

53.7% of ViewRay shares are held by institutional investors. Comparatively, 89.4% of ABIOMED shares are held by institutional investors. 62.8% of ViewRay shares are held by insiders. Comparatively, 7.0% of ABIOMED shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

ViewRay has a beta of -0.32, suggesting that its stock price is 132% less volatile than the S&P 500. Comparatively, ABIOMED has a beta of 0.27, suggesting that its stock price is 73% less volatile than the S&P 500.

Profitability

This table compares ViewRay and ABIOMED’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ViewRay -333.93% N/A -69.60%
ABIOMED 16.13% 13.03% 10.98%

Earnings & Valuation

This table compares ViewRay and ABIOMED’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
ViewRay $18.41 million 21.47 -$43.16 million ($1.29) -5.19
ABIOMED $474.78 million 16.22 $110.92 million $1.69 103.33

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

Summary

ABIOMED beats ViewRay on 9 of the 13 factors compared between the two stocks.

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.

About ABIOMED

ABIOMED, Inc. is a provider of temporary percutaneous mechanical circulatory support devices. The Company offers care to heart failure patients. The Company operates in the segment of the research, development and sale of medical devices to assist or replace the pumping function of the failing heart. The Company develops, manufactures and markets products that are designed to enable the heart to rest, heal and recover by improving blood flow to the coronary arteries and end-organs and/or temporarily performing the pumping function of the heart. The Company’s product portfolio includes the Impella 2.5, Impella CP, Impella RP, Impella LD, Impella 5.0 and AB5000. The Company’s products are used in the cardiac catheterization lab (cath lab), by interventional cardiologists, the electrophysiology lab, the hybrid lab and in the heart surgery suite by heart surgeons.

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