Align Technology (NASDAQ: ALGN) and Hill-Rom Holdings (NYSE:HRC) are both mid-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, institutional ownership, profitability and analyst recommendations.
Volatility & Risk
Align Technology has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500. Comparatively, Hill-Rom Holdings has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.
Valuation and Earnings
This table compares Align Technology and Hill-Rom Holdings’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Align Technology||$1.08 billion||18.85||$189.68 million||$3.29||77.17|
|Hill-Rom Holdings||$2.74 billion||1.97||$133.60 million||$1.99||41.16|
Align Technology has higher revenue, but lower earnings than Hill-Rom Holdings. Hill-Rom Holdings is trading at a lower price-to-earnings ratio than Align Technology, indicating that it is currently the more affordable of the two stocks.
This table compares Align Technology and Hill-Rom Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
80.7% of Align Technology shares are held by institutional investors. Comparatively, 80.4% of Hill-Rom Holdings shares are held by institutional investors. 1.6% of Align Technology shares are held by company insiders. Comparatively, 2.2% of Hill-Rom Holdings shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a summary of recent ratings and target prices for Align Technology and Hill-Rom Holdings, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Align Technology presently has a consensus price target of $218.40, indicating a potential downside of 13.98%. Hill-Rom Holdings has a consensus price target of $88.33, indicating a potential upside of 7.84%. Given Hill-Rom Holdings’ higher possible upside, analysts clearly believe Hill-Rom Holdings is more favorable than Align Technology.
Hill-Rom Holdings pays an annual dividend of $0.72 per share and has a dividend yield of 0.9%. Align Technology does not pay a dividend. Hill-Rom Holdings pays out 36.2% of its earnings in the form of a dividend. Align Technology has raised its dividend for 6 consecutive years.
Align Technology beats Hill-Rom Holdings on 13 of the 17 factors compared between the two stocks.
Align Technology Company Profile
Align Technology, Inc. designs, manufactures and markets a system of clear aligner therapy, intra-oral scanners and computer-aided design/computer-aided manufacturing (CAD/CAM) digital services used in dentistry, orthodontics and dental records storage. The Company operates through two segments: Clear Aligner segment and Scanner and Services (Scanner) segment. The Clear Aligner segment consists of its Invisalign System, which includes Invisalign Full, Teen and Assist (Comprehensive Products), Express/Lite (Non-Comprehensive Products) and Vivera Retainers, along with its training and ancillary products for treating malocclusion (Non-Case). The Scanner segment consists of intra-oral scanning systems and other services available with the intra-oral scanners that provide digital alternatives to the traditional cast models. The Scanner segment includes its iTero scanner and OrthoCAD services.
Hill-Rom Holdings Company Profile
Hill-Rom Holdings, Inc. is a global medical technology company. The Company operates through four segments: North America Patient Support Systems, International Patient Support Systems, Front Line Care and Surgical Solutions. The Company’s products and services include Patient Support Systems, Front Line Care and Surgical Solutions. The Company sells and rents its specialty frames and surfaces, and mobility solutions, as well as its clinical workflow solutions, in the United States and Canada through its North America Patient Support Systems segment, and in regions outside of the United States and Canada through its International Patient Support Systems segment. Its Front Line Care segment globally sells and rents respiratory care products, and sells medical diagnostic equipment and a diversified portfolio of devices that assess, diagnose, treat and manage a range of illnesses and diseases. Under its Surgical Solutions segment, the Company sells its surgical products globally.
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