Critical Review: Omnicell (OMCL) vs. Its Competitors

Omnicell (NASDAQ:OMCL) is one of 511 publicly-traded companies in the “Healthcare Equipment & Supplies” industry, but how does it weigh in compared to its peers? We will compare Omnicell to related companies based on the strength of its risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Insider & Institutional Ownership

97.7% of Omnicell shares are held by institutional investors. Comparatively, 40.5% of shares of all “Healthcare Equipment & Supplies” companies are held by institutional investors. 2.9% of Omnicell shares are held by insiders. Comparatively, 14.8% of shares of all “Healthcare Equipment & Supplies” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Omnicell and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Omnicell	0	1	7	1	3.00
Omnicell Competitors	4273	10549	18323	829	2.46

Omnicell presently has a consensus price target of $57.86, indicating a potential upside of 54.95%. As a group, “Healthcare Equipment & Supplies” companies have a potential upside of 21.20%. Given Omnicell’s stronger consensus rating and higher probable upside, analysts plainly believe Omnicell is more favorable than its peers.

Profitability

This table compares Omnicell and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Omnicell	3.59%	5.69%	3.61%
Omnicell Competitors	-278.24%	-150.08%	-21.87%

Valuation and Earnings

This table compares Omnicell and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Omnicell	$1.18 billion	$2.05 million	38.90
Omnicell Competitors	$1.87 billion	$138.21 million	9.46

Omnicell’s peers have higher revenue and earnings than Omnicell. Omnicell is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Volatility and Risk

Omnicell has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500. Comparatively, Omnicell’s peers have a beta of 2.56, suggesting that their average stock price is 156% more volatile than the S&P 500.

Summary

Omnicell beats its peers on 9 of the 13 factors compared.

Omnicell Company Profile

Omnicell, Inc., together with its subsidiaries, provides medication management solutions and adherence tools for healthcare systems and pharmacies the United States and internationally. The company offers point of care automation solutions to improve clinician workflows in patient care areas of the healthcare system; XT Series automated dispensing systems for medications and supplies used in nursing units and other clinical areas of the hospital, as well as specialized automated dispensing systems for operating room; and robotic dispensing systems for handling the stocking and retrieval of boxed medications. It also provides central pharmacy automation solutions; IV compounding robots; and inventory management software. In addition, the company provides single-dose automation solutions that fill and label a variety of patient-specific, single-dose medication blister packaging based on incoming prescriptions; fully automated and semi-automated filling equipment for institutional pharmacies to warrant automated packaging of medications; and medication blister card packaging and packaging supplies to enhance medication adherence in non-acute care settings. Further, it offers EnlivenHealth Patient Engagement, a web-based solutions. The company was formerly known as Omnicell Technologies, Inc. and changed its name to Omnicell, Inc. in 2001. Omnicell, Inc. was incorporated in 1992 and is headquartered in Fort Worth, Texas.