Analyzing Globus Medical (GMED) and LivaNova (LIVN)

Globus Medical (NYSE: GMED) and LivaNova (NASDAQ:LIVN) are both mid-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, profitability, valuation and earnings.

Risk and Volatility

Globus Medical has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, LivaNova has a beta of 0.61, suggesting that its stock price is 39% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Globus Medical and LivaNova, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Globus Medical 1 4 7 0 2.50
LivaNova 1 2 4 0 2.43

Globus Medical currently has a consensus target price of $36.83, indicating a potential downside of 6.13%. LivaNova has a consensus target price of $78.17, indicating a potential downside of 2.69%. Given LivaNova’s higher possible upside, analysts plainly believe LivaNova is more favorable than Globus Medical.

Earnings and Valuation

This table compares Globus Medical and LivaNova’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Globus Medical $563.99 million 6.71 $104.34 million $1.10 35.67
LivaNova $1.21 billion 3.19 -$62.78 million $1.17 68.66

Globus Medical has higher earnings, but lower revenue than LivaNova. Globus Medical is trading at a lower price-to-earnings ratio than LivaNova, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

72.2% of Globus Medical shares are owned by institutional investors. Comparatively, 86.1% of LivaNova shares are owned by institutional investors. 28.2% of Globus Medical shares are owned by insiders. Comparatively, 0.3% of LivaNova shares are owned 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.

Profitability

This table compares Globus Medical and LivaNova’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Globus Medical 17.54% 13.67% 12.35%
LivaNova 4.63% 9.33% 6.82%

Summary

Globus Medical beats LivaNova on 9 of the 14 factors compared between the two stocks.

About Globus Medical

Globus Medical, Inc. (Globus) is a medical device company focused on the design, development and commercialization of musculoskeletal implants that promote healing in patients with spine disorders. The Company is focused on implants that promote healing in patients with spine disorders. The Company’s products fall into one of two categories: Innovative Fusion or Disruptive Technologies. The Company sells its products through exclusive sales force in the United States, as well as within North, Central & South America, Europe, Asia, Africa and Australia. The sales force consists of direct sales representatives and distributor sales representatives employed by exclusive independent distributors.

About LivaNova

LivaNova PLC is a medical device company focused on the development and delivery of therapeutic solutions. The Company’s segments include Cardiac Surgery, Cardiac Rhythm Management, Neuromodulation and Other. The Cardiac Surgery segment is engaged in the development, production and sale of cardiovascular surgery products. Cardiac Surgery products include oxygenators, heart-lung machines, autotransfusion, mechanical heart valves and tissue heart valves. The Cardiac Rhythm Management segment is engaged in the development, manufacturing and marketing of products for the diagnosis, treatment, and management of heart rhythm disorders and heart failure. Cardiac Rhythm Management products include high-voltage defibrillators Cardiac Resynchronization Therapy device (CRT-D) and low-voltage pacemakers. The Neuromodulation segment is engaged in the design, development and marketing of neuromodulation therapy for the treatment of drug-resistant epilepsy and treatment resistant depression.

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