Comparing Cardinal Health (NYSE:CAH) & Lifevantage (NASDAQ:LFVN)

Cardinal Health (NYSE:CAH) and Lifevantage (NASDAQ:LFVN) are both medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, dividends, earnings, profitability, analyst recommendations, institutional ownership and valuation.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Cardinal Health and Lifevantage, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cardinal Health	0	2	14	0	2.88
Lifevantage	0	1	2	0	2.67

Cardinal Health presently has a consensus target price of $212.60, indicating a potential upside of 5.74%. Lifevantage has a consensus target price of $23.50, indicating a potential upside of 262.10%. Given Lifevantage’s higher probable upside, analysts plainly believe Lifevantage is more favorable than Cardinal Health.

Valuation and Earnings

This table compares Cardinal Health and Lifevantage”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cardinal Health	$222.58 billion	0.21	$1.56 billion	$6.63	30.33
Lifevantage	$228.53 million	0.36	$9.81 million	$0.77	8.43

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

Profitability

This table compares Cardinal Health and Lifevantage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cardinal Health	0.68%	-84.37%	4.19%
Lifevantage	4.43%	33.52%	15.81%

Risk & Volatility

Cardinal Health has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500. Comparatively, Lifevantage has a beta of 0.34, suggesting that its share price is 66% less volatile than the S&P 500.

Insider and Institutional Ownership

87.2% of Cardinal Health shares are held by institutional investors. Comparatively, 35.3% of Lifevantage shares are held by institutional investors. 0.1% of Cardinal Health shares are held by company insiders. Comparatively, 22.0% of Lifevantage shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Cardinal Health pays an annual dividend of $2.04 per share and has a dividend yield of 1.0%. Lifevantage pays an annual dividend of $0.18 per share and has a dividend yield of 2.8%. Cardinal Health pays out 30.8% of its earnings in the form of a dividend. Lifevantage pays out 23.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Cardinal Health has raised its dividend for 29 consecutive years and Lifevantage has raised its dividend for 3 consecutive years. Lifevantage is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Cardinal Health beats Lifevantage on 9 of the 17 factors compared between the two stocks.

About Cardinal Health

Cardinal Health, Inc. operates as a healthcare services and products company in the United States, Canada, Europe, Asia, and internationally. It provides customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices, and patients in the home. The company operates in two segments, Pharmaceutical and Medical. The Pharmaceutical segment distributes branded and generic pharmaceutical, specialty pharmaceutical, and over-the-counter healthcare and consumer products. The segment also provides services to pharmaceutical manufacturers and healthcare providers for specialty pharmaceutical products; operates nuclear pharmacies and radiopharmaceutical manufacturing facilities; repackages generic pharmaceuticals and over-the-counter healthcare products; and provides pharmacy management services to hospitals. The Medical segment manufactures, sources, and distributes Cardinal Health branded medical, surgical, and laboratory products and devices that include exam and surgical gloves; needles, syringe, and sharps disposals; compressions; incontinences; nutritional delivery products; wound care products; single-use surgical drapes, gowns, and apparels; fluid suction and collection systems; urology products; operating room supply products; and electrode product lines. The segment also distributes a range of national brand products, including medical, surgical, and laboratory products; provides supply chain services and solutions to hospitals, ambulatory surgery centers, clinical laboratories, and other healthcare providers; and assembles and sells sterile, and non-sterile procedure kits. The company was incorporated in 1979 and is headquartered in Dublin, Ohio.

About Lifevantage

LifeVantage Corporation engages in the identification, research, development, formulation, and sale of advanced nutrigenomic activators, dietary supplements, nootropics, pre- and pro-biotics, weight management, skin and hair care, bath and body, and targeted relief products. It offers Protandim, a dietary supplement; LifeVantage Omega+, a dietary supplement that combines DHA and EPA Omega-3 fatty acids, Omega-7 fatty acids, and vitamin D3; LifeVantage ProBio, a dietary supplement to support gut health; PhysIQ, a weight management system; LifeVantage IC Bright, a supplement to support eye and brain health, reduce eye fatigue and strain, supports cognitive functions, and support normal sleep patterns; Petandim for Dogs, a supplement to combat oxidative stress in dogs; and Axio, a nootropic energy drink mix. The company also provides anti-aging skin care products, including liquid collagen, facial cleansers, perfecting lotions, eye serums, anti-aging creams, hand creams, beauty serum, as well as hair care products, such as invigorating shampoos, nourishing conditioners, and scalp serums under the LifeVantage TrueScience brand name. In addition, it offers bath and body, and targeted relief products, such as body lotion, body wash, body butter, deodorant, soothing balm, and body rub under the TrueScience brand name. It sells its products through its website and network of independent distributors in the United States, Mexico, Japan, Australia, Hong Kong, Canada, Thailand, the United Kingdom, the Netherlands, Germany, Taiwan, Austria, Spain, Ireland, Belgium, New Zealand, Singapore, and the Philippines. The company was founded in 2003 and is headquartered in Lehi, Utah.