Financial Contrast: Penumbra (NYSE:PEN) and Tactile Systems Technology (TCMD)

Penumbra (NYSE: PEN) and Tactile Systems Technology (NASDAQ:TCMD) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Penumbra and Tactile Systems Technology, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Penumbra 0 0 2 0 3.00
Tactile Systems Technology 0 0 4 0 3.00

Penumbra presently has a consensus target price of $98.00, suggesting a potential upside of 17.86%. Tactile Systems Technology has a consensus target price of $33.00, suggesting a potential downside of 2.48%. Given Penumbra’s higher possible upside, equities analysts plainly believe Penumbra is more favorable than Tactile Systems Technology.

Profitability

This table compares Penumbra and Tactile Systems Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Penumbra -2.78% -2.58% -2.27%
Tactile Systems Technology 4.97% 3.05% 2.54%

Earnings and Valuation

This table compares Penumbra and Tactile Systems Technology’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Penumbra $294.09 million 9.55 -$3.32 million ($0.27) -307.95
Tactile Systems Technology $97.23 million 6.12 $3.09 million $0.25 135.36

Tactile Systems Technology has higher revenue, but lower earnings than Penumbra. Penumbra is trading at a lower price-to-earnings ratio than Tactile Systems Technology, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

69.4% of Penumbra shares are owned by institutional investors. Comparatively, 35.1% of Tactile Systems Technology shares are owned by institutional investors. 22.0% of Penumbra shares are owned by insiders. Comparatively, 49.9% of Tactile Systems Technology shares are owned by 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

Tactile Systems Technology beats Penumbra on 7 of the 11 factors compared between the two stocks.

About Penumbra

Penumbra, Inc. is a healthcare company focused on interventional therapies. The Company designs, develops, manufactures and markets medical devices. It has a portfolio of products that addresses medical conditions and clinical needs across two markets, neuro and peripheral vascular. The conditions that its products address include ischemic stroke, hemorrhagic stroke and various peripheral vascular conditions that can be treated through thrombectomy and embolization procedures. It focuses on developing, manufacturing and marketing products for use by specialist physicians, including interventional neuroradiologists, neurosurgeons, interventional neurologists, interventional radiologists and vascular surgeons. Its neuro products include Neurovascular Access, Neuro Thrombectomy (Ischemic Stroke), Neurovascular Embolization (Brain Aneurysms) and Neurosurgical Tools (Hemorrhagic Stroke). Its peripheral vascular products include Peripheral Vascular Embolization and Peripheral Thrombectomy.

About Tactile Systems Technology

Tactile Systems Technology, Inc. is a medical technology company that develops and provides medical devices for the treatment of chronic diseases at home. The Company is a manufacturer and distributor of the Flexitouch and Entre Systems, medical devices that help control symptoms of lymphedema, a chronic and progressive medical condition that is often an unintended consequence of cancer treatment, and the ACTitouch System, a medical device used to treat venous leg ulcers and chronic venous insufficiency. Its products deliver long-term treatment of chronic diseases. The Company provides its products for use in the home and sells them through vascular, wound and lymphedema clinics throughout the United States. The Company offers a platform to deliver at-home healthcare solutions throughout the United States. Its initial area of therapeutic focus is vascular disease, with a focus on advancing the care in treating lymphedema and chronic venous insufficiency.

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