Head-To-Head Comparison: TransMedics Group (NASDAQ:TMDX) & STERIS (NYSE:STE)

TransMedics Group (NASDAQ:TMDX) and STERIS (NYSE:STE) are both medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, profitability, risk, institutional ownership, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current ratings for TransMedics Group and STERIS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TransMedics Group	0	5	7	0	2.58
STERIS	0	1	6	0	2.86

TransMedics Group currently has a consensus price target of $152.33, indicating a potential upside of 42.74%. STERIS has a consensus price target of $275.20, indicating a potential upside of 25.36%. Given TransMedics Group’s higher probable upside, research analysts plainly believe TransMedics Group is more favorable than STERIS.

Valuation & Earnings

This table compares TransMedics Group and STERIS”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TransMedics Group	$605.49 million	6.05	$190.29 million	$4.90	21.78
STERIS	$5.46 billion	3.94	$614.64 million	$7.17	30.62

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

Institutional & Insider Ownership

99.7% of TransMedics Group shares are owned by institutional investors. Comparatively, 94.7% of STERIS shares are owned by institutional investors. 7.0% of TransMedics Group shares are owned by insiders. Comparatively, 1.1% of STERIS shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares TransMedics Group and STERIS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TransMedics Group	31.43%	30.17%	11.39%
STERIS	12.15%	14.34%	9.58%

Risk & Volatility

TransMedics Group has a beta of 2.09, suggesting that its stock price is 109% more volatile than the S&P 500. Comparatively, STERIS has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500.

Summary

TransMedics Group beats STERIS on 9 of the 14 factors compared between the two stocks.

About TransMedics Group

TransMedics Group, Inc., a commercial-stage medical technology company, engages in transforming organ transplant therapy for end-stage organ failure patients in the United States and internationally. The company offers Organ Care System (OCS), a portable organ perfusion, optimization, and monitoring system that utilizes its proprietary and customized technology to replicate near-physiologic conditions for donor organs outside of the human body. Its OCS includes OCS LUNG for the preservation of standard criteria donor lungs for double-lung transplantation; OCS Heart, a technology for preservation of DBD donor hearts deemed unsuitable due to limitations of cold storage and for ex vivo reanimation, functional monitoring, and beating-heart preservation of donation-after-circulatory-death hearts; and OCS Liver for the preservation of DBD and DCD of donor livers. The company also developed national OCS program, a turnkey solution for outsourced organ retrieval; and provides OCS organ management and logistics services, including aviation and ground transportation, and other coordination activity. The company was founded in 1998 and is headquartered in Andover, Massachusetts.

About STERIS

STERIS plc provides infection prevention products and services worldwide. It operates through four segments: Healthcare, Applied Sterilization Technologies, Life Sciences, and Dental. The Healthcare segment offers cleaning chemistries and sterility assurance products; automated endoscope reprocessing system and tracking products; endoscopy accessories, washers, sterilizers, and other pieces of capital equipment for the operation of a sterile processing department; and equipment used directly in the operating room, including surgical tables, lights, and connectivity solutions, as well as equipment management services. It also provides capital equipment installation, maintenance, upgradation, repair, and troubleshooting services; preventive maintenance programs and repair services; instrument and endoscope repair and maintenance services; and custom process improvement consulting and outsourced instrument sterile processing services. The Applied Sterilization Technologies segment provides contract sterilization and testing services for medical device and pharmaceutical manufacturers through a network of approximately 50 contract sterilization and laboratory facilities. The Life Sciences segment designs, manufactures and sells consumable products, such as formulated cleaning chemistries, barrier, sterility assurance products, steam and vaporized hydrogen peroxide sterilizers, and washer disinfectors. This segment also offers equipment installation, maintenance, upgradation, repair, and troubleshooting services; and preventive maintenance programs and repair services. The Dental segment provides hand and electric-powered dental instruments, infection control products, conscious sedation, personal protective equipment, and water quality products for dental suite. The company serves its products and services to hospitals, other healthcare providers, and pharmaceutical manufacturers. The company was founded in 1985 and is based in Dublin, Ireland.