Mazor Robotics (NASDAQ: MZOR) and Varian Medical Systems (NYSE:VAR) are both medical companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, profitability, analyst recommendations and valuation.

Insider and Institutional Ownership

26.5% of Mazor Robotics shares are owned by institutional investors. Comparatively, 99.2% of Varian Medical Systems shares are owned by institutional investors. 0.9% 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 is poised for long-term growth.

Valuation & Earnings

This table compares Mazor Robotics and Varian Medical Systems’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mazor Robotics $36.38 million 38.49 -$18.66 million ($0.71) -77.28
Varian Medical Systems $2.67 billion 3.84 $249.60 million $2.69 41.59

Varian Medical Systems has higher revenue and earnings than Mazor Robotics. Mazor Robotics 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.

Volatility and Risk

Mazor Robotics has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500. Comparatively, Varian Medical Systems has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Profitability

This table compares Mazor Robotics and Varian Medical Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mazor Robotics -28.80% -22.68% -18.29%
Varian Medical Systems 8.85% 23.68% 10.74%

Analyst Ratings

This is a summary of recent ratings for Mazor Robotics and Varian Medical Systems, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mazor Robotics 2 5 1 0 1.88
Varian Medical Systems 2 7 1 0 1.90

Mazor Robotics presently has a consensus price target of $39.60, indicating a potential downside of 27.83%. Varian Medical Systems has a consensus price target of $98.39, indicating a potential downside of 12.05%. Given Varian Medical Systems’ stronger consensus rating and higher possible upside, analysts clearly believe Varian Medical Systems is more favorable than Mazor Robotics.

Summary

Varian Medical Systems beats Mazor Robotics on 10 of the 12 factors compared between the two stocks.

Mazor Robotics Company Profile

Mazor Robotics Ltd is an Israel-based medical device company that develops and markets surgical guidance systems and complementary products. It develops computerized and imaging-based systems in the field of spine surgery. Its products include: Renaissance Surgical Guidance System, which enables surgeons to advance from freehand surgical procedures to guided procedures, as well as Food and Drug Administration (FDA)-cleared and European Conformity (CE)-marked Renaissance System, used in spine surgeries, whether open or minimally invasive, for a number of clinical indications. Its Renaissance System and its predecessor are used in a number of spine surgeries, including fusion, correction of spinal deformities, biopsy collection, tumor excision and cement augmentations. Furthermore the Company developed the Renaissance Brain Module, an application of its Renaissance System that provides control over the insertion of surgical instruments during brain surgery.

Varian Medical Systems Company Profile

Varian Medical Systems, Inc. is a manufacturer of medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, proton therapy and brachytherapy medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, proton therapy and brachytherapy. The Company also has Varian Particle Therapy (VPT) and the operations of the Ginzton Technology Center (GTC). Its VPT business develops, designs, manufactures, sells and services products and systems for delivering proton therapy, another form of external beam radiotherapy using proton beams for the treatment of cancer. Its ProBeam system is capable of delivering intensity modulated proton therapy (IMPT) using pencil beam scanning technology. Its ProBeam Compact is a single room proton therapy product.

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