Comparing HealthEquity (NASDAQ:HQY) and CochLear (OTCMKTS:CHEOY)

CochLear (OTCMKTS:CHEOY) and HealthEquity (NASDAQ:HQY) are both mid-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.

Profitability

This table compares CochLear and HealthEquity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CochLear	N/A	N/A	N/A
HealthEquity	16.39%	13.86%	8.67%

Institutional and Insider Ownership

99.6% of HealthEquity shares are held by institutional investors. 1.5% of HealthEquity shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and price targets for CochLear and HealthEquity, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CochLear	0	3	1	1	2.60
HealthEquity	1	1	12	1	2.87

HealthEquity has a consensus target price of $111.79, suggesting a potential upside of 31.76%. Given HealthEquity’s stronger consensus rating and higher probable upside, analysts clearly believe HealthEquity is more favorable than CochLear.

Risk & Volatility

CochLear has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500. Comparatively, HealthEquity has a beta of 0.19, indicating that its stock price is 81% less volatile than the S&P 500.

Valuation & Earnings

This table compares CochLear and HealthEquity”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CochLear	$1.53 billion	3.09	$251.85 million	N/A	N/A
HealthEquity	$1.31 billion	5.46	$215.20 million	$2.46	34.49

CochLear has higher revenue and earnings than HealthEquity.

Summary

HealthEquity beats CochLear on 9 of the 12 factors compared between the two stocks.

About CochLear

Cochlear Limited provides implantable hearing solutions for children and adults worldwide. It offers cochlear implant systems, sound processor upgrades, bone conduction systems, accessories, and other products. Cochlear Limited was founded in 1981 and is headquartered in Sydney, Australia.

About HealthEquity

HealthEquity, Inc. provides technology-enabled services platforms to consumers and employers in the United States. The company offers cloud-based platforms for individuals to make health saving and spending decisions, pay healthcare bills, receive personalized benefit information, earn wellness incentives, grow their savings, and make investment choices; and health savings accounts. It also provides investment platform; and online-only automated investment advisory services through Advisor, a Web-based tool. In addition, the company offers flexible spending accounts; health reimbursement arrangements; and Consolidated Omnibus Budget Reconciliation Act continuation services, as well as administers pre-tax commuter benefit programs. It serves clients through a direct sales force; benefits brokers and advisors; and a network of health plans, benefits administrators, benefits brokers and consultants, and retirement plan record-keepers. HealthEquity, Inc. was incorporated in 2002 and is based in Draper, Utah.