Critical Review: CareFusion (CFN) and The Competition

CareFusion (NYSE: CFN) is one of 80 public companies in the “Medical Equipment, Supplies & Distribution” industry, but how does it compare to its peers? We will compare CareFusion to similar companies based on the strength of its analyst recommendations, institutional ownership, risk, profitability, dividends, earnings and valuation.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for CareFusion and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CareFusion 0 0 0 0 N/A
CareFusion Competitors 274 1313 2703 100 2.60

As a group, “Medical Equipment, Supplies & Distribution” companies have a potential upside of 5.16%. Given CareFusion’s peers higher possible upside, analysts clearly believe CareFusion has less favorable growth aspects than its peers.

Insider and Institutional Ownership

65.6% of shares of all “Medical Equipment, Supplies & Distribution” companies are held by institutional investors. 12.4% of shares of all “Medical Equipment, Supplies & Distribution” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares CareFusion and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
CareFusion N/A N/A 25.51
CareFusion Competitors $984.68 million $120.37 million 266.13

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

Profitability

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

Net Margins Return on Equity Return on Assets
CareFusion 16.18% 12.80% 7.62%
CareFusion Competitors -115.70% -24.91% -10.54%

Summary

CareFusion peers beat CareFusion on 5 of the 8 factors compared.

CareFusion Company Profile

CareFusion Corporation is a global medical technology company. The Company operates in two business segments: Medical Systems and Procedural Solutions. The Company’s primary product brands include: Alaris intravenous (IV) infusion systems; Pyxis and Rowa automated medication dispensing and supply management systems; AVEA, Vela and LTV Series respiratory ventilators; ChloraPrep skin antiseptic products; MaxGuard, MaxPlus, MaxZero, SmartSite and Texium needle-free IV infusion valves, administration sets and accessories; V. Mueller and Snowden-Pencer open surgical and laparoscopic instrumentation; PleurX, Achieve and Temno interventional specialty products; AirLife disposable ventilator circuits and oxygen masks used for providing respiratory therapy; Vital Signs single-use consumables for respiratory care and anesthesiology; Jaeger and SensorMedics cardiopulmonary diagnostic equipment, and MedMined data mining surveillance software and analytics.

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