Reviewing STAAR Surgical (NASDAQ:STAA) & Merit Medical Systems (NASDAQ:MMSI)

Merit Medical Systems (NASDAQ:MMSI) and STAAR Surgical (NASDAQ:STAA) are both medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Merit Medical Systems and STAAR Surgical, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merit Medical Systems	0	2	9	0	2.82
STAAR Surgical	2	9	1	0	1.92

Merit Medical Systems currently has a consensus target price of $105.67, indicating a potential upside of 28.53%. STAAR Surgical has a consensus target price of $20.91, indicating a potential upside of 17.72%. Given Merit Medical Systems’ stronger consensus rating and higher probable upside, research analysts clearly believe Merit Medical Systems is more favorable than STAAR Surgical.

Profitability

This table compares Merit Medical Systems and STAAR Surgical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Merit Medical Systems	8.02%	14.27%	8.23%
STAAR Surgical	-41.79%	-16.06%	-12.40%

Valuation and Earnings

This table compares Merit Medical Systems and STAAR Surgical”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Merit Medical Systems	$1.36 billion	3.59	$120.36 million	$1.95	42.16
STAAR Surgical	$313.90 million	2.81	-$20.21 million	($1.95)	-9.11

Merit Medical Systems has higher revenue and earnings than STAAR Surgical. STAAR Surgical is trading at a lower price-to-earnings ratio than Merit Medical Systems, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Merit Medical Systems has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, STAAR Surgical has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500.

Institutional and Insider Ownership

99.7% of Merit Medical Systems shares are owned by institutional investors. Comparatively, 96.7% of STAAR Surgical shares are owned by institutional investors. 3.2% of Merit Medical Systems shares are owned by company insiders. Comparatively, 0.6% of STAAR Surgical shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Merit Medical Systems beats STAAR Surgical on 13 of the 14 factors compared between the two stocks.

About Merit Medical Systems

Merit Medical Systems, Inc. designs, develops, manufactures, and markets single-use medical products for interventional, diagnostic, and therapeutic procedures in the United States and internationally. It operates in two segments, Cardiovascular and Endoscopy. The company provides micropuncture kits, angiographic needles, sheaths, guide wires, and safety products; peripheral intervention, including angiography, drainage, delivery systems, and embolotherapy products; spine products, such as vertebral augmentation, radiofrequency ablation, and bone biopsy systems; oncology products; and cardiac intervention products, such as access, angiography, electrophysiology and cardiac rhythm management, fluid management, hemodynamic monitoring, hemostasis, and intervention to treat various heart conditions. It also offers custom procedural solutions that include critical care products, disinfection protection systems, syringes, manifold kits, and trays and packs; coating services for medical tubes and wires; and sensor components for microelectromechanical systems. In addition, the company provides pulmonary products that consist of laser-cut tracheobronchial stents, over-the-wire and direct visualization delivery systems, and dilation balloons to endoscopically dilate structures; gastroenterology products, such as covered esophageal stents, syringe and gauges, and balloon dilators; and kits and accessories for endoscopy and bronchoscopy procedures. It sells its products to hospitals and alternate site-based physicians, technicians, and nurses through direct sales force, distributors, original equipment manufacturer partners, or custom procedure tray manufacturers. The company was incorporated in 1987 and is headquartered in South Jordan, Utah.

About STAAR Surgical

STAAR Surgical Company, together with its subsidiaries, designs, develops, manufactures, markets, and sells implantable lenses for the eye, and companion delivery systems to deliver the lenses into the eye. The company provides implantable Collamer lens product family (ICLs) to treat visual disorders, such as myopia, hyperopia, astigmatism, and presbyopia. It markets its products to health care providers, including ophthalmic surgeons, vision and surgical centers, hospitals, government facilities, and distributors, as well as products are primarily used by ophthalmologists. The company sells its products directly through its sales representatives in the United States, Japan, Germany, Spain, Canada, the United Kingdom, and Singapore, as well as through own representatives and independent distributors in China, Korea, India, France, Benelux, Italy, and internationally. STAAR Surgical Company was incorporated in 1982 and is headquartered in Lake Forest, California.