Critical Review: QuidelOrtho (NASDAQ:QDEL) & TransMedics Group (NASDAQ:TMDX)

TransMedics Group (NASDAQ:TMDX) and QuidelOrtho (NASDAQ:QDEL) are both healthcare companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, valuation, risk and profitability.

Valuation and Earnings

This table compares TransMedics Group and QuidelOrtho”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TransMedics Group	$605.49 million	4.04	$190.29 million	$3.89	18.19
QuidelOrtho	$2.67 billion	0.35	-$1.13 billion	($15.41)	-0.89

TransMedics Group has higher earnings, but lower revenue than QuidelOrtho. QuidelOrtho is trading at a lower price-to-earnings ratio than TransMedics Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares TransMedics Group and QuidelOrtho’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TransMedics Group	22.69%	15.88%	5.95%
QuidelOrtho	-39.20%	4.88%	1.63%

Insider and Institutional Ownership

99.7% of TransMedics Group shares are owned by institutional investors. Comparatively, 99.0% of QuidelOrtho shares are owned by institutional investors. 6.9% of TransMedics Group shares are owned by company insiders. Comparatively, 1.1% of QuidelOrtho shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

TransMedics Group has a beta of 1.94, meaning that its stock price is 94% more volatile than the S&P 500. Comparatively, QuidelOrtho has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for TransMedics Group and QuidelOrtho, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TransMedics Group	1	6	5	0	2.33
QuidelOrtho	2	4	0	0	1.67

TransMedics Group currently has a consensus target price of $115.60, indicating a potential upside of 63.42%. QuidelOrtho has a consensus target price of $13.62, indicating a potential downside of 0.76%. Given TransMedics Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe TransMedics Group is more favorable than QuidelOrtho.

Summary

TransMedics Group beats QuidelOrtho on 13 of the 14 factors compared between the two stocks.

About TransMedics Group

TransMedics Group, Inc., a commercial-stage medical technology company, engages in transforming organ transplant therapy for end-stage organ failure patients in the United States and internationally. The company offers Organ Care System (OCS), a portable organ perfusion, optimization, and monitoring system that utilizes its proprietary and customized technology to replicate near-physiologic conditions for donor organs outside of the human body. Its OCS includes OCS LUNG for the preservation of standard criteria donor lungs for double-lung transplantation; OCS Heart, a technology for preservation of DBD donor hearts deemed unsuitable due to limitations of cold storage and for ex vivo reanimation, functional monitoring, and beating-heart preservation of donation-after-circulatory-death hearts; and OCS Liver for the preservation of DBD and DCD of donor livers. The company also developed national OCS program, a turnkey solution for outsourced organ retrieval; and provides OCS organ management and logistics services, including aviation and ground transportation, and other coordination activity. The company was founded in 1998 and is headquartered in Andover, Massachusetts.

About QuidelOrtho

QuidelOrtho Corporation provides diagnostic testing solutions. The company operates through Labs, Transfusion Medicine, Point-of-Care, and Molecular Diagnostics business units. The Labs business unit provides clinical chemistry laboratory instruments and tests that measure target chemicals in bodily fluids for the evaluation of health and the clinical management of patients; immunoassay laboratory instruments and tests, which measure proteins as they act as antigens in the spread of disease, antibodies in the immune response spurred by disease, or markers of proper organ function and health; testing products to detect and monitor disease progression across a spectrum of therapeutic areas; and specialized diagnostic solutions. The Transfusion Medicine business unit offers immunohematology instruments and tests used for blood typing to ensure patient-donor compatibility in blood transfusions; and donor screening instruments and tests used for blood and plasma screening for infectious diseases. The Point-of-Care business unit provides instruments and tests to provide rapid results across a continuum of point-of-care settings. The Molecular Diagnostics business unit offers polymerase chain reaction thermocyclers; amplification systems; and sample-to-result molecular instruments and tests for syndromic infectious disease diagnostics. The company sells its products directly to end users through a direct sales force; and through a network of distributors for professional use in physician offices, hospitals, clinical laboratories, reference laboratories, urgent care clinics, universities, retail clinics, pharmacies, wellness screening centers, blood banks, and donor centers, as well as for individual, non-professional, and over-the-counter use. It operates in North America, Europe, the Middle East, Africa, China, and internationally. The company was incorporated in 1979 and is headquartered in San Diego, California.