Contrasting Avantor (NYSE:AVTR) & Sotera Health (NASDAQ:SHC)

Avantor (NYSE:AVTR) and Sotera Health (NASDAQ:SHC) are both mid-cap medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.

Risk & Volatility

Avantor has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500. Comparatively, Sotera Health has a beta of 1.81, meaning that its stock price is 81% more volatile than the S&P 500.

Valuation & Earnings

This table compares Avantor and Sotera Health”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Avantor	$6.78 billion	1.33	$711.50 million	$0.99	13.39
Sotera Health	$1.10 billion	4.24	$44.34 million	$0.08	205.38

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

Insider and Institutional Ownership

95.1% of Avantor shares are owned by institutional investors. Comparatively, 91.0% of Sotera Health shares are owned by institutional investors. 1.2% of Avantor shares are owned by company insiders. Comparatively, 47.6% of Sotera Health shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Avantor and Sotera Health’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Avantor	10.31%	11.39%	5.44%
Sotera Health	2.14%	39.42%	5.66%

Analyst Recommendations

This is a summary of recent recommendations for Avantor and Sotera Health, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avantor	0	8	7	0	2.47
Sotera Health	0	1	4	0	2.80

Avantor currently has a consensus price target of $15.50, indicating a potential upside of 16.94%. Sotera Health has a consensus price target of $16.00, indicating a potential downside of 2.62%. Given Avantor’s higher probable upside, equities analysts clearly believe Avantor is more favorable than Sotera Health.

About Avantor

Avantor, Inc. engages in the provision of mission-critical products and services to customers in the biopharma, healthcare, education and government, advanced technologies, and applied materials industries in the Americas, Europe, Asia, the Middle East, and Africa. The company offers materials and consumables, such as purity chemicals and reagents, lab products and supplies, formulated silicone materials, customized excipients, customized single-use assemblies, process chromatography resins and columns, analytical sample prep kits, education and microbiology products, clinical trial kits, peristaltic pumps, and fluid handling tips. It also provides equipment and instrumentation products, including filtration systems, virus inactivation systems, incubators, analytical instruments, evaporators, ultra-low-temperature freezers, biological safety cabinets, and critical environment supplies. In addition, the company offers services and specialty procurements comprising onsite lab and production, clinical, equipment, procurement and sourcing, and biopharmaceutical material scale-up and development services. Further, it provides scientific research support services, such as DNA extraction, bioreactor servicing, clinical and biorepository, and compound management services. The company was founded in 1904 and is headquartered in Radnor, Pennsylvania.

About Sotera Health

Sotera Health Company engages in the provision of sterilization, lab testing, and advisory services in the United States and internationally. The company operates through three segments: Sterigenics, Nordion, and Nelson Labs. It provides mission-critical end-to-end sterilization services, including gamma and electron beam irradiation, and ethylene oxide processing, as well as designs, installs, and maintains gamma irradiation systems. The company also provides microbiological and analytical chemistry testing, as well as technical assistance, regulatory consulting, and advisory services. It serves medical devices, pharmaceuticals, food safety, agricultural products, cancer treatment, and high-performance materials industries, as well as commercial, advanced, and specialty application industries. The company was formerly known as Sotera Health Topco, Inc. and changed its name to Sotera Health Company in October 2020. Sotera Health Company was incorporated in 2015 and is headquartered in Broadview Heights, Ohio.