Head to Head Contrast: ResMed (NYSE:RMD) and Modular Medical (NASDAQ:MODD)

ResMed (NYSE:RMD) and Modular Medical (NASDAQ:MODD) are both medical companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, valuation and institutional ownership.

Profitability

This table compares ResMed and Modular Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ResMed	27.53%	25.20%	18.55%
Modular Medical	N/A	-245.85%	-190.80%

Institutional & Insider Ownership

55.0% of ResMed shares are owned by institutional investors. Comparatively, 27.5% of Modular Medical shares are owned by institutional investors. 0.7% of ResMed shares are owned by insiders. Comparatively, 7.1% of Modular Medical shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares ResMed and Modular Medical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ResMed	$5.15 billion	6.48	$1.40 billion	$10.11	22.65
Modular Medical	N/A	N/A	-$18.82 million	($14.71)	-0.33

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

Risk and Volatility

ResMed has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500. Comparatively, Modular Medical has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for ResMed and Modular Medical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ResMed	0	5	8	1	2.71
Modular Medical	1	0	0	0	1.00

ResMed currently has a consensus price target of $298.82, suggesting a potential upside of 30.47%. Given ResMed’s stronger consensus rating and higher possible upside, equities research analysts clearly believe ResMed is more favorable than Modular Medical.

Summary

ResMed beats Modular Medical on 13 of the 14 factors compared between the two stocks.

About ResMed

ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications for the healthcare markets. The company operates in two segments, Sleep and Respiratory Care, and Software as a Service. It offers various products and solutions for a range of respiratory disorders, including ApneaLink Air, a portable diagnostic device that measures oximetry, respiratory effort, pulse, nasal flow, and snoring; and NightOwl, a portable, cloud-connected, and disposable diagnostic device that measures AHI based on derived peripheral arterial tone, actigraphy, and oximetry over several nights. The company also provides AirView, a cloud-based system that enables remote monitoring and changing of patients’ device settings; myAir, a personalized therapy management application for patients with sleep apnea that provides support, education, and troubleshooting tools for increased patient engagement and improved compliance; U-Sleep, a compliance monitoring solution that enables home medical equipment (HME) to streamline their sleep programs; connectivity module and propeller solutions; and Propeller portal. It offers out-of-hospital software solution, such as Brightree business management software and service solutions to providers of HME, pharmacy, home infusion, orthotics, and prosthetics services; MatrixCare care management and related ancillary solutions to senior living, skilled nursing, life plan communities, home health, home care, and hospice organizations, as well as related accountable care organizations; HEALTHCAREfirst that offers electronic health record, software, billing and coding services, and analytics for home health and hospice agencies; and MEDIFOX DAN’s software solutions. The company markets its products to sleep clinics, home healthcare dealers, and hospitals through a network of distributors and direct sales force. ResMed Inc. was founded in 1989 and is headquartered in San Diego, California.

About Modular Medical

Modular Medical, Inc. operates as a medical device company. It focuses on the design, development, and commercialization of insulin pumps. It offers MODD1, a two-part patch pump for type-1 and type-2 diabetes. The company is headquartered in San Diego, California.