Merit Medical Systems (NASDAQ:MMSI – Get Free Report) and STERIS (NYSE:STE – Get Free Report) are both healthcare companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.
Insider & Institutional Ownership
99.7% of Merit Medical Systems shares are held by institutional investors. Comparatively, 94.7% of STERIS shares are held by institutional investors. 0.7% of Merit Medical Systems shares are held by company insiders. Comparatively, 1.1% of STERIS shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Merit Medical Systems has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500. Comparatively, STERIS has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Merit Medical Systems | $1.52 billion | 3.54 | $128.49 million | $2.42 | 37.09 |
| STERIS | $5.94 billion | 3.60 | $782.30 million | $8.18 | 26.77 |
STERIS has higher revenue and earnings than Merit Medical Systems. STERIS is trading at a lower price-to-earnings ratio than Merit Medical Systems, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Merit Medical Systems and STERIS’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Merit Medical Systems | 9.22% | 13.75% | 8.10% |
| STERIS | 13.34% | 14.34% | 9.66% |
Analyst Ratings
This is a summary of recent ratings for Merit Medical Systems and STERIS, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Merit Medical Systems | 0 | 3 | 8 | 1 | 2.83 |
| STERIS | 0 | 1 | 3 | 0 | 2.75 |
Merit Medical Systems presently has a consensus price target of $100.00, indicating a potential upside of 11.42%. STERIS has a consensus price target of $271.33, indicating a potential upside of 23.89%. Given STERIS’s higher probable upside, analysts plainly believe STERIS is more favorable than Merit Medical Systems.
Summary
STERIS beats Merit Medical Systems on 10 of the 15 factors compared between the two stocks.
About Merit Medical Systems
Merit Medical Systems, Inc. designs, develops, manufactures, and markets single-use medical products for interventional, diagnostic, and therapeutic procedures in the United States and internationally. It operates in two segments, Cardiovascular and Endoscopy. The company provides micropuncture kits, angiographic needles, sheaths, guide wires, and safety products; peripheral intervention, including angiography, drainage, delivery systems, and embolotherapy products; spine products, such as vertebral augmentation, radiofrequency ablation, and bone biopsy systems; oncology products; and cardiac intervention products, such as access, angiography, electrophysiology and cardiac rhythm management, fluid management, hemodynamic monitoring, hemostasis, and intervention to treat various heart conditions. It also offers custom procedural solutions that include critical care products, disinfection protection systems, syringes, manifold kits, and trays and packs; coating services for medical tubes and wires; and sensor components for microelectromechanical systems. In addition, the company provides pulmonary products that consist of laser-cut tracheobronchial stents, over-the-wire and direct visualization delivery systems, and dilation balloons to endoscopically dilate structures; gastroenterology products, such as covered esophageal stents, syringe and gauges, and balloon dilators; and kits and accessories for endoscopy and bronchoscopy procedures. It sells its products to hospitals and alternate site-based physicians, technicians, and nurses through direct sales force, distributors, original equipment manufacturer partners, or custom procedure tray manufacturers. The company was incorporated in 1987 and is headquartered in South Jordan, Utah.
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.
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