West Pharmaceutical Services (NYSE:WST – Get Free Report) and iRhythm Technologies (NASDAQ:IRTC – Get Free Report) are both medical companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, risk, earnings, valuation, profitability, analyst recommendations and dividends.
Risk and Volatility
West Pharmaceutical Services has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.Comparatively, iRhythm Technologies has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.
Institutional & Insider Ownership
93.9% of West Pharmaceutical Services shares are held by institutional investors. 0.5% of West Pharmaceutical Services shares are held by company insiders. Comparatively, 0.7% of iRhythm Technologies shares are held 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.
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| West Pharmaceutical Services | $2.95 billion | 8.47 | $593.40 million | $6.74 | 51.17 |
| iRhythm Technologies | $492.68 million | 7.03 | -$123.41 million | ($4.86) | -22.77 |
West Pharmaceutical Services has higher revenue and earnings than iRhythm Technologies. iRhythm Technologies is trading at a lower price-to-earnings ratio than West Pharmaceutical Services, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and target prices for West Pharmaceutical Services and iRhythm Technologies, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| West Pharmaceutical Services | 0 | 1 | 5 | 0 | 2.83 |
| iRhythm Technologies | 0 | 2 | 9 | 0 | 2.82 |
West Pharmaceutical Services presently has a consensus price target of $430.20, indicating a potential upside of 24.73%. iRhythm Technologies has a consensus price target of $108.45, indicating a potential downside of 1.98%. Given West Pharmaceutical Services’ stronger consensus rating and higher possible upside, analysts plainly believe West Pharmaceutical Services is more favorable than iRhythm Technologies.
Profitability
This table compares West Pharmaceutical Services and iRhythm Technologies’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| West Pharmaceutical Services | 17.37% | 18.41% | 13.74% |
| iRhythm Technologies | -26.90% | -120.86% | -17.96% |
Summary
West Pharmaceutical Services beats iRhythm Technologies on 11 of the 14 factors compared between the two stocks.
About West Pharmaceutical Services
West Pharmaceutical Services, Inc. designs, manufactures, and sells containment and delivery systems for injectable drugs and healthcare products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It operates in two segments, Proprietary Products and Contract-Manufactured Products. The Proprietary Products segment offers stoppers and seals for injectable packaging systems; syringe and cartridge components, including custom solutions for the needs of injectable drug applications, as well as administration systems that enhance the safe delivery of drugs through advanced reconstitution, mixing, and transfer technologies; and films, coatings, washing, and vision inspection and sterilization processes and services to enhance the quality of packaging components. This segment also provides drug containment solutions, including Crystal Zenith, a cyclic olefin polymer in the form of vials, syringes, and cartridges; and self-injection devices; and a range of integrated solutions, including analytical lab services, pre-approval primary packaging support and engineering development, regulatory expertise, and after-sales technical support. This segment serves biologic, generic, and pharmaceutical drug companies. The Contract-Manufactured Products segment is involved in the design, manufacture, and automated assembly of devices used in surgical, diagnostic, ophthalmic, injectable, and other drug delivery systems, as well as consumer products. The company serves pharmaceutical, diagnostic, and medical device companies. It sells and distributes its products through its sales force and distribution network, contract sales agents, and regional distributors. West Pharmaceutical Services, Inc. was founded in 1923 and is headquartered in Exton, Pennsylvania.
About iRhythm Technologies
iRhythm Technologies, Inc., a digital healthcare company, engages in the design, development, and commercialization of device-based technology to provide ambulatory cardiac monitoring services to diagnose arrhythmias in the United States. It offers Zio services, an ambulatory monitoring solution, including long-term and short-term continuous monitoring and mobile cardiac telemetry monitoring services. The company also provides the Zio Monitor System, a prescription-only, remote electrocardiogram (ECG) monitoring system that consists of a patch ECG monitor that records the electric signal from the heart continuously for up to 14 days and the Zio ECG Utilization Software System, which supports the capture and analysis of ECG data recorded by the Zio Monitor patch at the end of the wear period, including specific arrhythmia events detected by the ZEUS System; the Zio XT System is the previous generation of the Zio Monitor System and is a prescription-only, remote ECG monitoring system that consists of the Zio XT patch that records the electric signal from the heart continuously for up to 14 days; and the Zio AT system, a prescription-only, remote ECG monitoring system that similarly consists of the Zio AT patch that records the electric signal from the heart continuously for up to 14 days and the ZEUS System, but which also incorporates the Zio AT wireless gateway that provides connectivity between the Zio AT patch and the ZEUS System during the patient wear period. It has a development collaboration agreement with Verily Life Sciences LLC and Verity Ireland Limited to develop various next-generation atrial fibrillation screening, detection, or monitoring products. The company was incorporated in 2006 and is headquartered in San Francisco, California.
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