Reviewing Pacific Biosciences of California (PACB) and ABIOMED (ABMD)

ABIOMED (NASDAQ: ABMD) and Pacific Biosciences of California (NASDAQ:PACB) are both healthcare companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, dividends, earnings and analyst recommendations.

Risk and Volatility

ABIOMED has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500. Comparatively, Pacific Biosciences of California has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for ABIOMED and Pacific Biosciences of California, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ABIOMED 0 2 6 0 2.75
Pacific Biosciences of California 0 2 1 0 2.33

ABIOMED currently has a consensus target price of $272.33, indicating a potential upside of 16.52%. Pacific Biosciences of California has a consensus target price of $6.27, indicating a potential upside of 146.72%. Given Pacific Biosciences of California’s higher probable upside, analysts clearly believe Pacific Biosciences of California is more favorable than ABIOMED.

Insider and Institutional Ownership

90.4% of ABIOMED shares are held by institutional investors. Comparatively, 70.9% of Pacific Biosciences of California shares are held by institutional investors. 7.0% of ABIOMED shares are held by insiders. Comparatively, 17.8% of Pacific Biosciences of California shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares ABIOMED and Pacific Biosciences of California’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ABIOMED 16.58% 15.54% 13.40%
Pacific Biosciences of California -98.63% -96.55% -58.68%

Earnings & Valuation

This table compares ABIOMED and Pacific Biosciences of California’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ABIOMED $445.30 million 23.24 $52.11 million $1.98 118.04
Pacific Biosciences of California $93.47 million 3.16 -$92.19 million ($0.89) -2.85

ABIOMED has higher revenue and earnings than Pacific Biosciences of California. Pacific Biosciences of California is trading at a lower price-to-earnings ratio than ABIOMED, indicating that it is currently the more affordable of the two stocks.

Summary

ABIOMED beats Pacific Biosciences of California on 11 of the 14 factors compared between the two stocks.

About ABIOMED

ABIOMED, Inc. is a provider of temporary percutaneous mechanical circulatory support devices. The Company offers care to heart failure patients. The Company operates in the segment of the research, development and sale of medical devices to assist or replace the pumping function of the failing heart. The Company develops, manufactures and markets products that are designed to enable the heart to rest, heal and recover by improving blood flow to the coronary arteries and end-organs and/or temporarily performing the pumping function of the heart. The Company’s product portfolio includes the Impella 2.5, Impella CP, Impella RP, Impella LD, Impella 5.0 and AB5000. The Company’s products are used in the cardiac catheterization lab (cath lab), by interventional cardiologists, the electrophysiology lab, the hybrid lab and in the heart surgery suite by heart surgeons.

About Pacific Biosciences of California

Pacific Biosciences of California, Inc. designs, develops and manufactures sequencing systems to help scientists resolve genetically complex problems. The Company is engaged in the development, manufacturing and marketing of an integrated platform for genetic analysis. Its Single Molecule, Real-Time (SMRT) technology enables single molecule, real-time detection of biological processes. It offers The SMRT Cell, Phospholinked nucleotides and The PacBio RS II and Sequel instruments. Its SMRT technology enables the observation of deoxyribonucleic acid (DNA) synthesis as it occurs in real-time by harnessing the natural process of DNA replication, which is actuated by the DNA polymerase. Its phospholinked nucleotides have a fluorescent dye attached to the phosphate chain of the nucleotide rather than to the base. The PacBio RS II and Sequel instruments include optics, automated liquid handling, a touchscreen control interface and computational hardware and software.

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