Reviewing Hill-Rom (NYSE:HRC) & Becton Dickinson and (NYSE:BDX)

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Hill-Rom (NYSE:HRC) and Becton Dickinson and (NYSE:BDX) are both medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Volatility & Risk

Hill-Rom has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500. Comparatively, Becton Dickinson and has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.

Valuation & Earnings

This table compares Hill-Rom and Becton Dickinson and’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hill-Rom $2.47 billion 2.81 $252.40 million $4.75 21.90
Becton Dickinson and $15.98 billion 4.27 $311.00 million $11.01 22.97

Becton Dickinson and has higher revenue and earnings than Hill-Rom. Hill-Rom is trading at a lower price-to-earnings ratio than Becton Dickinson and, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Hill-Rom and Becton Dickinson and’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hill-Rom 7.93% 21.30% 7.62%
Becton Dickinson and 5.88% 14.58% 5.81%

Dividends

Hill-Rom pays an annual dividend of $0.84 per share and has a dividend yield of 0.8%. Becton Dickinson and pays an annual dividend of $3.08 per share and has a dividend yield of 1.2%. Hill-Rom pays out 17.7% of its earnings in the form of a dividend. Becton Dickinson and pays out 28.0% 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. Hill-Rom has raised its dividend for 8 consecutive years and Becton Dickinson and has raised its dividend for 47 consecutive years. Becton Dickinson and is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Hill-Rom and Becton Dickinson and, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hill-Rom 0 2 5 0 2.71
Becton Dickinson and 0 4 6 1 2.73

Hill-Rom currently has a consensus target price of $108.71, indicating a potential upside of 4.52%. Becton Dickinson and has a consensus target price of $264.45, indicating a potential upside of 4.58%. Given Becton Dickinson and’s stronger consensus rating and higher possible upside, analysts clearly believe Becton Dickinson and is more favorable than Hill-Rom.

Institutional and Insider Ownership

81.3% of Hill-Rom shares are held by institutional investors. Comparatively, 84.5% of Becton Dickinson and shares are held by institutional investors. 0.7% of Hill-Rom shares are held by company insiders. Comparatively, 0.1% of Becton Dickinson and shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Becton Dickinson and beats Hill-Rom on 13 of the 18 factors compared between the two stocks.

Hill-Rom Company Profile

Hill-Rom Holdings, Inc. operates as a medical technology company worldwide. It operates in three segments: Patient Support Systems, Front Line Care, and Surgical Solutions. The company offers medical surgical beds, intensive care unit beds, and bariatric patient beds, lifts and other patient mobility devices, non-invasive therapeutic products and surfaces, and information technologies and software solutions; and medical equipment management services, as well as sells equipment service contracts for its capital equipment. It also provides patient monitoring and diagnostics products, such as blood pressure, physical assessment, vital signs monitoring, diagnostic cardiopulmonary, diabetic retinopathy screening, and thermometry products; and respiratory health products comprising Vest System, VitalCough System, MetaNeb System, and Monarch systems to assist patients in the mobilization of retained blockages. In addition, the company offers surgical solutions that include surgical tables, lights, and pendants; positioning devices for use in shoulder, hip, spinal, and lithotomy surgeries, as well as platform-neutral positioning accessories for operating room tables; and operating room surgical safety and accessory products, which comprise scalpels and blades, light handle systems, skin markers, and other disposable products. Further, it is involved in the sales and rental of products to acute and extended care facilities through direct sales force and distributors; sales and rental of products directly to patients in the home; and sales to primary care facilities through distributors. Additionally, the company offers continuum of clinical care, including acute care and primary care, as well as clinical research organizations. Hill-Rom Holdings, Inc. was founded in 1969 and is headquartered in Chicago, Illinois.

Becton Dickinson and Company Profile

Becton, Dickinson and Company develops, manufactures, and sells medical supplies, devices, laboratory equipment, and diagnostic products worldwide. The company's BD Medical segment offers peripheral IV and advanced peripheral catheters, central lines, acute dialysis catheters, vascular care and preparation products, needle-free IV connectors and extensions sets, IV fluids, closed-system drug transfer devices, hazardous drug detection, hypodermic syringes and needles, anesthesia needles and trays, enteral syringes, sharps disposal systems; infusion pumps and dedicated disposables, medication compounding workflow systems, automated medication dispensing, automated supply management systems, medication inventory optimization and tracking systems; syringes, pen needles, and other products for diabetes care; and prefillable drug delivery systems. Its BD Life Sciences segment provides specimen and blood collection products and systems; automated blood and tuberculosis culturing, molecular testing, microorganism identification and drug susceptibility, and liquid-based cytology systems, as well as rapid diagnostic assays, microbiology laboratory automation products, and plated media products; and fluorescence-activated cell sorters and analyzers, monoclonal antibodies and kits, reagent systems, bench-side solutions, and molecular indexing and next-generation sequencing sample preparation products, as well as clinical oncology, immunological, and transplantation diagnostic/monitoring reagents and analyzers. The company's BD Interventional segment offers hernia and soft tissue repair, biological and bioresorbable grafts, biosurgery, and other surgical products; surgical infection prevention, thoracic and abdominal drainage, and surgical and laparoscopic instrumentation products; peripheral intervention products; and urology and critical care products. Becton, Dickinson and Company was founded in 1897 and is based in Franklin Lakes, New Jersey.

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