Critical Analysis: Penumbra (NYSE:PEN) & GE HealthCare Technologies (NASDAQ:GEHC)

GE HealthCare Technologies (NASDAQ:GEHC) and Penumbra (NYSE:PEN) are both large-cap healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, earnings, profitability, analyst recommendations, risk and institutional ownership.

Insider and Institutional Ownership

82.1% of GE HealthCare Technologies shares are held by institutional investors. Comparatively, 88.9% of Penumbra shares are held by institutional investors. 0.4% of GE HealthCare Technologies shares are held by company insiders. Comparatively, 2.9% of Penumbra shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares GE HealthCare Technologies and Penumbra’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GE HealthCare Technologies	9.96%	20.45%	5.97%
Penumbra	10.67%	10.50%	8.17%

Valuation and Earnings

This table compares GE HealthCare Technologies and Penumbra”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GE HealthCare Technologies	$21.64 billion	1.66	$2.08 billion	$4.74	16.78
Penumbra	$1.40 billion	9.01	$177.69 million	$3.97	80.91

GE HealthCare Technologies has higher revenue and earnings than Penumbra. GE HealthCare Technologies is trading at a lower price-to-earnings ratio than Penumbra, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

GE HealthCare Technologies has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500. Comparatively, Penumbra has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for GE HealthCare Technologies and Penumbra, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GE HealthCare Technologies	0	11	12	0	2.52
Penumbra	0	14	3	0	2.18

GE HealthCare Technologies currently has a consensus price target of $80.57, indicating a potential upside of 1.28%. Penumbra has a consensus price target of $367.07, indicating a potential upside of 14.28%. Given Penumbra’s higher possible upside, analysts clearly believe Penumbra is more favorable than GE HealthCare Technologies.

Summary

Penumbra beats GE HealthCare Technologies on 8 of the 14 factors compared between the two stocks.

About GE HealthCare Technologies

GE HealthCare Technologies Inc. engages in the development, manufacture, and marketing of products, services, and complementary digital solutions used in the diagnosis, treatment, and monitoring of patients in the United States, Canada, and internationally. The company operates through four segments: Imaging, Ultrasound, Patient Care Solutions, and Pharmaceutical Diagnostics. The Imaging segment offers molecular imaging, computed tomography (CT) scanning, magnetic resonance (MR) imaging, image-guided therapy, X-ray systems, and women’s health products. The Ultrasound segment provides medical devices and solutions for screening, diagnosis, treatment, and monitoring of certain diseases in clinical areas, such as radiology and primary care, women’s health, cardiovascular, and point of care and handheld ultrasound solutions, as well as surgical visualization and guidance products. The Patient Care Solutions segment provides medical devices, consumables, services, and digital solutions. Its portfolio includes patient monitoring solutions, anesthesia delivery and respiratory care products, electrocardiogram solutions, maternal infant care products, and consumables and services. The Pharmaceutical Diagnostics supplies diagnostic agents, including CT, angiography and X-ray, MR, single-photon emission computed tomography, positron emission tomography, and ultrasound to the radiology and nuclear medicine industry. The segment also provides contrast media pharmaceuticals that are administered to a patient prior to certain diagnostic scans to increase the visibility of tissues or structures during imaging exams; and molecular imaging agents or radiopharmaceuticals, which are molecular tracers labeled with radioisotopes. It has an AI collaboration with Mass General Brigham. The company was formerly known as GE Healthcare Holding LLC and changed its name to GE HealthCare Technologies Inc. in December 2022. The company was incorporated in 2022 and is headquartered in Chicago, Illinois.

About Penumbra

Penumbra, Inc., together with its subsidiaries, designs, develops, manufactures, and markets medical devices in the United States and internationally. The company offers peripheral products, including the Indigo System for power aspiration of thrombus in the body; Lightning Flash, a mechanical thrombectomy system; Lightning Bolt 7, an arterial thrombectomy system; and CAT RX. It also provides access products, including guide catheters and the Penumbra distal delivery catheters under the Neuron, Neuron MAX Select, BENCHMARK, BMX96, BMX81, DDC, SENDit, and PX SLIM brands; Penumbra System, an integrated mechanical thrombectomy system comprising reperfusion catheters and separators, the 3D Revascularization Device, aspiration tubing, and aspiration pump under the Penumbra RED, JET, ACE, Max, 3D Revascularization Device, and Penumbra ENGINE brands; and neuro embolization coiling systems that includes the Penumbra Coil 400, a detachable coil that provides an alternative for the treatment of aneurysms and other complex lesions, as well as Penumbra SMART COIL, a detachable coil to treat patients with a wide range of neurovascular lesions; and POD400 and PAC400 brands. In addition, the company provides peripheral embolization products, such as Ruby Coil System consisting of detachable coils for peripheral applications; Penumbra LANTERN Delivery Microcatheter, a low-profile microcatheter with a high-flow lumen; POD (Penumbra Occlusion Device) System, a single device solution; and Packing Coil, a complementary device for use in other peripheral embolization products. Further, it offers an immersive 3D computer-based technology platform under the real immersive system brand; and neurosurgical tools, such as Artemis Neuro Evacuation Device for surgical removal of fluid and tissue from the ventricles and cerebrum. The company sells its products through direct sales organizations and distributors. Penumbra, Inc. was incorporated in 2004 and is headquartered in Alameda, California.