Comparing Intuitive Surgical (NASDAQ:ISRG) & Veracyte (NASDAQ:VCYT)

Veracyte (NASDAQ:VCYT) and Intuitive Surgical (NASDAQ:ISRG) are both medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Insider & Institutional Ownership

83.6% of Intuitive Surgical shares are held by institutional investors. 1.6% of Veracyte shares are held by insiders. Comparatively, 0.6% of Intuitive Surgical shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

Veracyte has a beta of 1.93, suggesting that its stock price is 93% more volatile than the S&P 500. Comparatively, Intuitive Surgical has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Veracyte and Intuitive Surgical, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Veracyte	1	3	5	1	2.60
Intuitive Surgical	1	6	21	0	2.71

Veracyte presently has a consensus target price of $55.88, indicating a potential upside of 0.48%. Intuitive Surgical has a consensus target price of $519.13, indicating a potential upside of 45.48%. Given Intuitive Surgical’s stronger consensus rating and higher possible upside, analysts plainly believe Intuitive Surgical is more favorable than Veracyte.

Profitability

This table compares Veracyte and Intuitive Surgical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Veracyte	16.25%	9.07%	8.38%
Intuitive Surgical	28.45%	16.91%	14.83%

Earnings & Valuation

This table compares Veracyte and Intuitive Surgical”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Veracyte	$517.15 million	8.58	$66.35 million	$1.09	51.02
Intuitive Surgical	$10.06 billion	12.53	$2.86 billion	$8.73	40.87

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

Summary

Intuitive Surgical beats Veracyte on 11 of the 15 factors compared between the two stocks.

About Veracyte

Veracyte, Inc. engages in the research, development and commercialization of diagnostic products. The firm’s portfolio includes Afirma, Percepta, and Envisia. It intends to treat thyroid cancer, improve lung cancer screening, and clarify the diagnosis of idiopathic pulmonary fibrosis. The company was founded by Bonnie H. Anderson and Y. Douglas Dolginow on August 15, 2006 and is headquartered in South San Francisco, CA.

About Intuitive Surgical

Intuitive Surgical, Inc. develops, manufactures, and markets products that enable physicians and healthcare providers to enhance the quality of and access to minimally invasive care in the United States and internationally. The company offers the da Vinci Surgical System that enables complex surgery using a minimally invasive approach; and Ion endoluminal system, which extends its commercial offerings beyond surgery into diagnostic procedures enabling minimally invasive biopsies in the lung. It also provides a suite of stapling, energy, and core instrumentation for its multi-port da Vinci surgical systems; progressive learning pathways to support the use of its technology; infrastructure of service and support specialists, a complement of services to its customers, including installation, repair, maintenance, 24/7 technical support, and proactive system health monitoring; and integrated digital capabilities providing connected offerings, streamlining performance for hospitals with program-enhancing insights. The company sells its products through direct sales organizations, such as capital and clinical sales teams. It has a collaboration agreement with FluoGuide A/S for head & neck cancer. The company was incorporated in 1995 and is headquartered in Sunnyvale, California.