Head to Head Survey: Pulmonx (NASDAQ:LUNG) and iRhythm Technologies (NASDAQ:IRTC)

Pulmonx (NASDAQ:LUNG) and iRhythm Technologies (NASDAQ:IRTC) are both medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, dividends, risk, earnings, analyst recommendations, valuation and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for Pulmonx and iRhythm Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pulmonx	0	3	5	0	2.63
iRhythm Technologies	0	1	10	0	2.91

Pulmonx currently has a consensus price target of $11.53, suggesting a potential upside of 255.71%. iRhythm Technologies has a consensus price target of $133.73, suggesting a potential downside of 8.87%. Given Pulmonx’s higher possible upside, equities research analysts clearly believe Pulmonx is more favorable than iRhythm Technologies.

Valuation and Earnings

This table compares Pulmonx and iRhythm Technologies”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pulmonx	$87.47 million	1.49	-$60.84 million	($1.44)	-2.25
iRhythm Technologies	$618.59 million	7.57	-$123.41 million	($3.14)	-46.73

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

Profitability

This table compares Pulmonx and iRhythm Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pulmonx	-67.31%	-55.36%	-33.53%
iRhythm Technologies	-19.14%	-118.83%	-11.34%

Volatility and Risk

Pulmonx has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500. Comparatively, iRhythm Technologies has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500.

Insider & Institutional Ownership

91.0% of Pulmonx shares are owned by institutional investors. 6.8% of Pulmonx shares are owned by company insiders. Comparatively, 1.1% of iRhythm Technologies shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

About Pulmonx

Pulmonx Corporation, a commercial-stage medical technology company, provides minimally invasive devices for the treatment of chronic obstructive pulmonary diseases. The company offers Zephyr Endobronchial Valve, a solution for the treatment of patients with hyperinflation associated with severe emphysema; and Chartis Pulmonary Assessment System, a balloon catheter and console system with flow and pressure sensors that are used to assess the presence of collateral ventilation. It also offers StratX Lung Analysis Platform, a cloud-based quantitative computed tomography analysis service that offers information on emphysema destruction, fissure completeness, and lobar volume to help identify target lobes for the treatment with Zephyr Valves. The company serves emphysema patients in the United States, Europe, the Middle East, Africa, the Asia-Pacific, and internationally. The company was formerly known as Pulmonx and changed its name to Pulmonx Corporation in December 2013. Pulmonx Corporation was incorporated in 1995 and is headquartered in Redwood City, California.

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.