Critical Survey: Becton, Dickinson and Company (NYSE:BDX) and CONMED (NYSE:CNMD)

CONMED (NYSE:CNMD) and Becton, Dickinson and Company (NYSE:BDX) are both medical companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.

Dividends

CONMED pays an annual dividend of $0.80 per share and has a dividend yield of 1.8%. Becton, Dickinson and Company pays an annual dividend of $4.16 per share and has a dividend yield of 2.3%. CONMED pays out 39.0% of its earnings in the form of a dividend. Becton, Dickinson and Company pays out 71.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Becton, Dickinson and Company has increased its dividend for 53 consecutive years. Becton, Dickinson and Company is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares CONMED and Becton, Dickinson and Company”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CONMED	$1.33 billion	1.03	$132.42 million	$2.05	21.43
Becton, Dickinson and Company	$21.39 billion	2.38	$1.71 billion	$5.83	30.51

Becton, Dickinson and Company has higher revenue and earnings than CONMED. CONMED is trading at a lower price-to-earnings ratio than Becton, Dickinson and Company, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and price targets for CONMED and Becton, Dickinson and Company, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CONMED	1	4	1	0	2.00
Becton, Dickinson and Company	0	9	3	0	2.25

CONMED currently has a consensus price target of $54.00, indicating a potential upside of 22.93%. Becton, Dickinson and Company has a consensus price target of $203.50, indicating a potential upside of 14.40%. Given CONMED’s higher possible upside, analysts clearly believe CONMED is more favorable than Becton, Dickinson and Company.

Institutional & Insider Ownership

87.0% of Becton, Dickinson and Company shares are owned by institutional investors. 3.1% of CONMED shares are owned by company insiders. Comparatively, 0.4% of Becton, Dickinson and Company shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares CONMED and Becton, Dickinson and Company’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CONMED	8.31%	14.43%	6.05%
Becton, Dickinson and Company	7.51%	16.23%	7.46%

Risk and Volatility

CONMED has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, Becton, Dickinson and Company has a beta of 0.25, indicating that its share price is 75% less volatile than the S&P 500.

Summary

Becton, Dickinson and Company beats CONMED on 12 of the 17 factors compared between the two stocks.

About CONMED

CONMED Corporation, a medical technology company, develops, manufactures, and sells surgical devices and related equipment for surgical procedures worldwide. The company offers orthopedic surgery products, including BioBrace, TruShot with Y-Knot All-In-One Soft Tissue Fixation System, Y-knot All-Suture Anchors, and Agro Knotless Suture Anchors, which provide clinical solutions to orthopedic surgeons for the augmentation and repair of soft tissue injuries, as well as provides supporting products that enable surgeons to perform minimally invasive sports medicine surgeries. It markets orthopedic surgery products under the Hall, CONMED Linvatec, Concept, and Shutt brands. The company also provides battery-powered and autoclavable bone power tool systems for use in orthopedic, arthroscopic, oral/maxillofacial, podiatric, spinal, and cardiothoracic surgeries under Hall surgical brand name. In addition, it offers general surgery products, including clinical insufflation systems under AirSeal brand; smoke removal devices under Buffalo Filter brand; endomechanical products, such as tissue retrieval bags, trocars, suction irrigation devices, graspers, scissors, and dissectors used in minimally invasive surgeries; and electrosurgical solution comprising monopolar and bipolar generators, argon beam coagulation generators, handpieces, smoke management systems and other accessories. Further, the company provides endoscopic technologies, including therapeutic and diagnostic products for use in gastroenterology procedures, and products for the treatment of diseases of the dilatation, hemostasis, biliary, structure management, and infection prevention and patient monitoring, including ECG and EEG electrodes, and cardiac defibrillation pads. It markets its products directly to hospitals, surgery centers, and other healthcare institutions, as well as through medical specialty distributors. CONMED Corporation was incorporated in 1970 and is headquartered in Largo, Florida.

About Becton, Dickinson and Company

Becton, Dickinson and Company develops, manufactures, and sells medical supplies, devices, laboratory equipment, and diagnostic products for healthcare institutions, physicians, life science researchers, clinical laboratories, pharmaceutical industry, and the general public worldwide. The company operates in three segments: BD Medical, BD Life Sciences, and BD Interventional. The BD Medical segment provides peripheral intravenous (IV) and advanced peripheral catheters, central lines, acute dialysis catheters, vascular access technology, vascular care and preparation products, needle-free IV connectors and extensions sets, closed-system drug transfer devices, hazardous drug detections, hypodermic syringes and needles, anesthesia needles and trays, enteral syringes, and sharps disposal systems; IV medication safety and infusion therapy delivery systems, medication compounding workflow systems, automated medication dispensing and supply management systems, and medication inventory optimization and tracking systems; and prefillable drug delivery systems. The BD Life Sciences segment offers specimen and blood collection products; automated blood and tuberculosis culturing, molecular testing, microorganism identification and drug susceptibility, and liquid-based cytology systems, as well as rapid diagnostic assays, microbiology laboratory automation products, and plated media products; and fluorescence-activated cell sorters and analyzers, antibodies and kits, reagent systems, and solutions for single-cell gene expression analysis, as well as clinical oncology, immunological, and transplantation diagnostic/monitoring reagents and analyzers. The BD Interventional segment provides hernia and soft tissue repair, biological and bioresorbable grafts, biosurgery, and other surgical products; surgical infection prevention; peripheral intervention products; and urology and critical care products. The company was founded in 1897 and is headquartered in Franklin Lakes, New Jersey.