Critical Comparison: Pacific Biosciences of California (PACB) and Zeltiq Aesthetics (ZLTQ)

Zeltiq Aesthetics (NASDAQ: ZLTQ) and Pacific Biosciences of California (NASDAQ:PACB) are both healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, dividends, valuation, profitability, institutional ownership, earnings and analyst recommendations.

Insider and Institutional Ownership

70.5% of Pacific Biosciences of California shares are owned by institutional investors. 15.6% of Zeltiq Aesthetics shares are owned by company insiders. Comparatively, 17.8% of Pacific Biosciences of California shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Zeltiq Aesthetics and Pacific Biosciences of California’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zeltiq Aesthetics 9.78% 31.74% 20.11%
Pacific Biosciences of California -95.97% -97.50% -59.40%

Valuation & Earnings

This table compares Zeltiq Aesthetics and Pacific Biosciences of California’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Zeltiq Aesthetics N/A N/A N/A ($0.03) N/A
Pacific Biosciences of California $90.71 million 3.49 -$74.37 million ($0.91) -2.99

Zeltiq Aesthetics has higher earnings, but lower revenue than Pacific Biosciences of California. Pacific Biosciences of California is trading at a lower price-to-earnings ratio than Zeltiq Aesthetics, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and target prices for Zeltiq Aesthetics and Pacific Biosciences of California, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zeltiq Aesthetics 0 8 1 0 2.11
Pacific Biosciences of California 0 2 1 0 2.33

Zeltiq Aesthetics currently has a consensus price target of $56.25, suggesting a potential upside of Infinity. Pacific Biosciences of California has a consensus price target of $6.27, suggesting a potential upside of 130.39%. Given Zeltiq Aesthetics’ higher possible upside, equities analysts clearly believe Zeltiq Aesthetics is more favorable than Pacific Biosciences of California.

Zeltiq Aesthetics Company Profile

ZELTIQ Aesthetics, Inc. is a medical technology company. The Company focuses on developing and commercializing products utilizing its controlled-cooling technology platform. The Company’s product, the CoolSculpting System, is designed to reduce stubborn fat bulges. The Company sells its CoolSculpting system primarily to dermatologists, plastic surgeons, aesthetic specialists and obstetrics and gynecology (OBGYN) physicians. It also offers consumables, which are CoolSculpting procedure packs that are needed to perform procedures using its CoolSculpting system. CoolSculpting is a non-invasive fat reduction procedure. CoolSculpting utilizes its controlled cooling technology to selectively reduce stubborn fat bulges. The CoolSculpting system includes CoolSculpting control unit and CoolSculpting applicators. The CoolSculpting Applicator delivers vacuum suction and cooling to the fat bulge being treated.

Pacific Biosciences of California Company Profile

Pacific Biosciences of California, Inc. designs, develops and manufactures sequencing systems to help scientists resolve genetically complex problems. The Company is engaged in the development, manufacturing and marketing of an integrated platform for genetic analysis. Its Single Molecule, Real-Time (SMRT) technology enables single molecule, real-time detection of biological processes. It offers The SMRT Cell, Phospholinked nucleotides and The PacBio RS II and Sequel instruments. Its SMRT technology enables the observation of deoxyribonucleic acid (DNA) synthesis as it occurs in real-time by harnessing the natural process of DNA replication, which is actuated by the DNA polymerase. Its phospholinked nucleotides have a fluorescent dye attached to the phosphate chain of the nucleotide rather than to the base. The PacBio RS II and Sequel instruments include optics, automated liquid handling, a touchscreen control interface and computational hardware and software.

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