Critical Analysis: Intuitive Surgical (NASDAQ:ISRG) versus Integra LifeSciences (NASDAQ:IART)

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

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Intuitive Surgical	$10.06 billion	17.14	$2.86 billion	$7.89	61.58
Integra LifeSciences	$1.61 billion	0.55	-$6.94 million	($6.46)	-1.75

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

Profitability

This table compares Intuitive Surgical and Integra LifeSciences’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Intuitive Surgical	28.38%	15.06%	13.34%
Integra LifeSciences	-30.15%	14.06%	4.70%

Institutional & Insider Ownership

83.6% of Intuitive Surgical shares are owned by institutional investors. Comparatively, 84.8% of Integra LifeSciences shares are owned by institutional investors. 0.7% of Intuitive Surgical shares are owned by company insiders. Comparatively, 3.5% of Integra LifeSciences shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Intuitive Surgical has a beta of 1.65, meaning that its share price is 65% more volatile than the S&P 500. Comparatively, Integra LifeSciences has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Intuitive Surgical and Integra LifeSciences, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Intuitive Surgical	1	8	15	1	2.64
Integra LifeSciences	3	2	2	0	1.86

Intuitive Surgical currently has a consensus target price of $617.23, suggesting a potential upside of 27.04%. Integra LifeSciences has a consensus target price of $15.00, suggesting a potential upside of 32.51%. Given Integra LifeSciences’ higher possible upside, analysts clearly believe Integra LifeSciences is more favorable than Intuitive Surgical.

Summary

Intuitive Surgical beats Integra LifeSciences on 12 of the 15 factors compared between the two stocks.

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.

About Integra LifeSciences

Integra LifeSciences Holdings Corporation manufactures and sells surgical instruments, neurosurgical products, and wound care products for use in neurosurgery, neurocritical care, and otolaryngology. It operates in two segments, Codman Specialty Surgical and Tissue Technologies. The company offers neurosurgery and neuro critical care products, including tissue ablation equipment, dural repair products, cerebral spinal fluid management devices, intracranial monitoring equipment, and cranial stabilization equipment; and surgical headlamps and instrumentation, as well as after-market services. It also sells instrument patterns, and surgical and lighting products to hospitals and surgery centers, as well as dental, podiatry, and veterinary offices. In addition, the company provides regenerative technology products for the treatment of acute wounds; and surgical tissue repair products for hernia, tendon, peripheral nerve repair and protection. Further, it offers skin and wound repair, plastics and surgical reconstruction products, bone grafts, and nerve and tendon repair products. The company offers its products directly through various sales forces and other distribution channels to the hospitals, integrated health networks, group purchasing organizations, clinicians, surgery centers, and health care providers in the United States, Europe, Asia Pacific, and internationally. Integra LifeSciences Holdings Corporation was incorporated in 1989 and is headquartered in Princeton, New Jersey.