Reviewing Zimmer Biomet (NYSE:ZBH) & Owlet (NYSE:OWLT)

Owlet (NYSE:OWLT) and Zimmer Biomet (NYSE:ZBH) are both healthcare companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.

Institutional & Insider Ownership

72.6% of Owlet shares are owned by institutional investors. Comparatively, 88.9% of Zimmer Biomet shares are owned by institutional investors. 36.2% of Owlet shares are owned by insiders. Comparatively, 1.3% of Zimmer Biomet shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Owlet and Zimmer Biomet”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Owlet	$105.70 million	1.40	-$39.68 million	($0.75)	-6.77
Zimmer Biomet	$8.23 billion	2.08	$705.20 million	$4.11	21.79

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

Profitability

This table compares Owlet and Zimmer Biomet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Owlet	-8.61%	-601.24%	-15.96%
Zimmer Biomet	9.48%	13.12%	7.23%

Analyst Ratings

This is a breakdown of recent recommendations for Owlet and Zimmer Biomet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Owlet	1	1	3	0	2.40
Zimmer Biomet	2	14	6	0	2.18

Owlet currently has a consensus price target of $15.00, suggesting a potential upside of 195.57%. Zimmer Biomet has a consensus price target of $103.00, suggesting a potential upside of 14.98%. Given Owlet’s stronger consensus rating and higher possible upside, equities analysts clearly believe Owlet is more favorable than Zimmer Biomet.

Volatility & Risk

Owlet has a beta of 1.9, indicating that its stock price is 90% more volatile than the S&P 500. Comparatively, Zimmer Biomet has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500.

Summary

Zimmer Biomet beats Owlet on 10 of the 14 factors compared between the two stocks.

About Owlet

Owlet, Inc. provides digital parenting solutions in the United States and internationally. The company's platform focuses on giving real-time data and insights to parents. It offers Dream Sock, a wearable infant health monitor equipped with pulse oximetry technology to track vitals signs, such as pulse rate, oxygen, activity, and sleep patterns; BabySat which is intended for infants with heightened health risk; Owlet Cam, a monitoring device in smartphones that offers video and audio, predictive sleep insights, and cry detections; and accessories, including Owlet Sleeper, as well as Duo and Dream Duo that combines Smart Sock with the Owlet Cam. The company was founded in 2012 and is headquartered in Lehi, Utah.

About Zimmer Biomet

Zimmer Biomet Holdings, Inc., together with its subsidiaries, operates as a medical technology company worldwide. The company designs, manufactures, and markets orthopedic reconstructive products, such as knee and hip products; S.E.T. products, including sports medicine, biologics, foot and ankle, extremities, and trauma products; craniomaxillofacial and thoracic products comprising face and skull reconstruction products, as well as products that fixate and stabilize the bones of the chest to facilitate healing or reconstruction after open heart surgery, trauma, or for deformities of the chest. It also offers robotic, surgical, and bone cement products. The company's products and solutions are used to treat patients suffering from disorders of, or injuries to, bones, joints, or supporting soft tissues. It serves orthopedic surgeons, neurosurgeons, hospitals, stocking distributors, healthcare dealers, and other specialists, as well as agents, healthcare purchasing organizations, or buying groups. The company was formerly known as Zimmer Holdings, Inc. and changed its name to Zimmer Biomet Holdings, Inc. in June 2015. Zimmer Biomet Holdings, Inc. was founded in 1927 and is headquartered in Warsaw, Indiana.