LENSAR (NASDAQ:LNSR) versus STERIS (NYSE:STE) Critical Survey

STERIS (NYSE:STE) and LENSAR (NASDAQ:LNSR) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Earnings & Valuation

This table compares STERIS and LENSAR”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
STERIS	$5.46 billion	4.14	$614.64 million	$7.17	32.15
LENSAR	$53.49 million	2.63	-$31.40 million	($4.39)	-2.69

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

Profitability

This table compares STERIS and LENSAR’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
STERIS	12.15%	14.34%	9.58%
LENSAR	-87.12%	N/A	-73.64%

Insider & Institutional Ownership

94.7% of STERIS shares are held by institutional investors. Comparatively, 40.2% of LENSAR shares are held by institutional investors. 1.1% of STERIS shares are held by insiders. Comparatively, 66.0% of LENSAR shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for STERIS and LENSAR, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
STERIS	0	2	6	0	2.75
LENSAR	1	2	0	0	1.67

STERIS currently has a consensus price target of $275.20, suggesting a potential upside of 19.40%. LENSAR has a consensus price target of $15.00, suggesting a potential upside of 27.12%. Given LENSAR’s higher probable upside, analysts clearly believe LENSAR is more favorable than STERIS.

Volatility and Risk

STERIS has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, LENSAR has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500.

Summary

STERIS beats LENSAR on 12 of the 14 factors compared between the two stocks.

About STERIS

STERIS plc provides infection prevention products and services worldwide. It operates through four segments: Healthcare, Applied Sterilization Technologies, Life Sciences, and Dental. The Healthcare segment offers cleaning chemistries and sterility assurance products; automated endoscope reprocessing system and tracking products; endoscopy accessories, washers, sterilizers, and other pieces of capital equipment for the operation of a sterile processing department; and equipment used directly in the operating room, including surgical tables, lights, and connectivity solutions, as well as equipment management services. It also provides capital equipment installation, maintenance, upgradation, repair, and troubleshooting services; preventive maintenance programs and repair services; instrument and endoscope repair and maintenance services; and custom process improvement consulting and outsourced instrument sterile processing services. The Applied Sterilization Technologies segment provides contract sterilization and testing services for medical device and pharmaceutical manufacturers through a network of approximately 50 contract sterilization and laboratory facilities. The Life Sciences segment designs, manufactures and sells consumable products, such as formulated cleaning chemistries, barrier, sterility assurance products, steam and vaporized hydrogen peroxide sterilizers, and washer disinfectors. This segment also offers equipment installation, maintenance, upgradation, repair, and troubleshooting services; and preventive maintenance programs and repair services. The Dental segment provides hand and electric-powered dental instruments, infection control products, conscious sedation, personal protective equipment, and water quality products for dental suite. The company serves its products and services to hospitals, other healthcare providers, and pharmaceutical manufacturers. The company was founded in 1985 and is based in Dublin, Ireland.

About LENSAR

LENSAR, Inc., a commercial-stage medical device company, focuses on designing, developing, and marketing a femtosecond laser system for the treatment of cataracts and the management of pre-existing or surgically induced corneal astigmatism. It offers LENSAR Laser System that incorporates a range of proprietary technologies designed to assist the surgeon in obtaining visual outcomes, efficiency, and reproducibility by providing imaging, procedure planning, design, and precision. The company also offers ALLY Adaptive Cataract Treatment System, a platform design to femtosecond laser technology features that enhanced laser capabilities into a single small unit that allows surgeons to perform a femtosecond laser assisted cataract procedure in a single operating room. LENSAR, Inc. was incorporated in 2004 and is headquartered in Orlando, Florida.