Contrasting Natera (NASDAQ:NTRA) & Solventum (NYSE:SOLV)

Natera (NASDAQ:NTRA) and Solventum (NYSE:SOLV) are both large-cap medical companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Volatility & Risk

Natera has a beta of 1.76, suggesting that its share price is 76% more volatile than the S&P 500. Comparatively, Solventum has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.

Institutional & Insider Ownership

99.9% of Natera shares are owned by institutional investors. 5.6% of Natera shares are owned by insiders. Comparatively, 0.1% of Solventum shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Natera and Solventum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Natera	-12.89%	-22.22%	-15.03%
Solventum	4.52%	29.93%	6.65%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Natera and Solventum, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Natera	0	0	16	1	3.06
Solventum	1	6	4	0	2.27

Natera currently has a consensus price target of $193.8667, suggesting a potential upside of 21.31%. Solventum has a consensus price target of $85.75, suggesting a potential upside of 19.08%. Given Natera’s stronger consensus rating and higher probable upside, analysts plainly believe Natera is more favorable than Solventum.

Valuation and Earnings

This table compares Natera and Solventum”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Natera	$1.70 billion	12.93	-$190.43 million	($1.91)	-83.67
Solventum	$8.25 billion	1.51	$478.00 million	$2.16	33.34

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

Summary

Natera beats Solventum on 8 of the 15 factors compared between the two stocks.

About Natera

Natera, Inc., a diagnostics company, develops and commercializes molecular testing services worldwide. Its products include Panorama, a non-invasive prenatal test that screens for chromosomal abnormalities of a fetus, as well as in twin pregnancies; Horizon carrier screening test for individuals and couples determine if they are carriers of genetic variations that cause certain genetic conditions; Vistara single-gene NIPT screens for 25 single-gene disorders that cause severe skeletal, cardiac, and neurological conditions; Spectrum, preimplantation genetic tests for couples undergoing IVF; Anora that analyzes miscarriage tissue from women; Empower, a hereditary cancer screening test; and non-invasive prenatal paternity product, which allows a couple to establish paternity without waiting for the child to be born. The company also provides Signatera, a ctDNA blood test for molecular residual disease assessment and surveillance of disease recurrence in patients previously diagnosed with cancer; Altera, a tissue based comprehensive genomic profiling test; Prospera to assess active rejection in patients who have undergone kidney, heart, and lung transplantation; and Renasight, a kidney gene panel test. In addition, it offers Constellation, a cloud-based software product that enables laboratory customers to gain access through the cloud to the company's algorithms and bioinformatics to validate and launch tests. The company offers products through its direct sales force, as well as through a network of laboratory and distribution partners. It has a partnership agreement with BGI Genomics Co., Ltd. to develop, manufacture, and commercialize NGS-based genetic testing assays; and Foundation Medicine, Inc. to develop and commercialize personalized circulating tumor DNA monitoring assays. The company was founded in 2003 and is headquartered in Austin, Texas.

About Solventum

Solventum Corporation, a healthcare company, engages in the developing, manufacturing, and commercializing a portfolio of solutions to address critical customer and patient needs. It operates through four segments: Medsurg, Dental Solutions, Health Information Systems, and Purification and Filtration. The Medsurg segment is a provider of solutions including advanced wound care, I.V. site management, sterilization assurance, temperature management, surgical supplies, stethoscopes, and medical electrodes. The Dental Solutions segment provides a comprehensive suite of dental and orthodontic products including brackets, aligners, restorative cements, and bonding agents. The Health Information Systems provides software solutions including computer-assisted, physician documentation, direct-to-bill and coding automation, classification methodologies, speech, recognition, and data visualization platforms. The Purification and Filtration segment provides purification and filtration technologies including filters, purifiers, cartridges, and membranes. The company was incorporated in 2023 and is based in Saint Paul, Minnesota.