Comparing McKesson (NYSE:MCK) and Cooper Companies (NASDAQ:COO)

McKesson (NYSE:MCK) and Cooper Companies (NASDAQ:COO) are both large-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Volatility & Risk

McKesson has a beta of 0.5, indicating that its stock price is 50% less volatile than the S&P 500. Comparatively, Cooper Companies has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for McKesson and Cooper Companies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
McKesson	0	3	10	1	2.86
Cooper Companies	0	2	9	1	2.92

McKesson currently has a consensus target price of $719.2727, indicating a potential upside of 6.90%. Cooper Companies has a consensus target price of $96.7273, indicating a potential upside of 32.03%. Given Cooper Companies’ stronger consensus rating and higher possible upside, analysts clearly believe Cooper Companies is more favorable than McKesson.

Profitability

This table compares McKesson and Cooper Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
McKesson	0.84%	-196.66%	5.66%
Cooper Companies	10.39%	9.60%	6.35%

Insider & Institutional Ownership

85.1% of McKesson shares are held by institutional investors. Comparatively, 24.4% of Cooper Companies shares are held by institutional investors. 0.1% of McKesson shares are held by company insiders. Comparatively, 2.0% of Cooper Companies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares McKesson and Cooper Companies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
McKesson	$359.05 billion	0.23	$3.30 billion	$25.08	26.83
Cooper Companies	$3.99 billion	3.67	$392.30 million	$2.06	35.56

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

Summary

Cooper Companies beats McKesson on 9 of the 14 factors compared between the two stocks.

About McKesson

McKesson Corporation provides healthcare services in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International. The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter pharmaceutical drugs, and other healthcare-related products. This segment also offers practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices; and consulting, outsourcing, technological, and other services, as well as sells financial, operational, and clinical solutions to pharmacies. The RxTS segment serves biopharma and life sciences partners, and patients to address medication challenges for patients by working across healthcare; connects patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to deliver innovative solutions to help people get the medicine needed to live healthier lives; and provides prescription price transparency, benefit insight, dispensing support, third-party logistics, and wholesale distribution support services. The Medical-Surgical Solutions segment offers medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. The International segment provides distribution and services to wholesale, institutional, and retail customers in Europe and Canada. McKesson Corporation was founded in 1833 and is headquartered in Irving, Texas.

About Cooper Companies

The Cooper Companies, Inc., together with its subsidiaries, develops, manufactures, and markets contact lens wearers. The company operates in two segments, CooperVision and CooperSurgical. The CooperVision segment provides spherical lense, including lenses that correct near and farsightedness; and toric and multifocal lenses comprising lenses correcting vision challenges, such as astigmatism, presbyopia, and myopia in the Americas, Europe, Middle East, Africa, and Asia Pacific. The CooperSurgical segment focuses on family and women's health care, which provides fertility products and services, medical devices, and contraception, as well as cryostorage, such as cord blood and cord tissue storage to health care professionals and patients worldwide. It offers surgical and office products, including endosee endometrial imaging products, fetal pillow cephalic elevation devices for use in cesarean sections, illuminated speculum products, lone star retractor systems, loop electrosurgical excision procedure products, mara water ablation systems, paragard contraceptive IUDs, point-of-care, and uterine positioning products, as well as cryostorage, such as cord blood and cord tissue storage; fertility products and services, such as fertility consumables and equipment, donor gamete services, and genomic services, including genetic testing. The company sells its products to distributors, group purchasing organizations, eye care and health care professionals, including independent practices, corporate retailers, hospitals and clinics, and authorized resellers. The Cooper Companies, Inc. was founded in 1958 and is headquartered in San Ramon, California.