Analyzing Tactile Systems Technology (NASDAQ:TCMD) & 3M (NASDAQ:MMM)

Tactile Systems Technology (NASDAQ:TCMD) and 3M (NYSE:MMM) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, valuation, risk and earnings.

Dividends

3M pays an annual dividend of $5.76 per share and has a dividend yield of 3.6%. Tactile Systems Technology does not pay a dividend. 3M pays out 55.1% of its earnings in the form of a dividend. 3M has increased its dividend for 60 consecutive years.

Analyst Recommendations

This is a summary of current recommendations for Tactile Systems Technology and 3M, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tactile Systems Technology 0 1 5 0 2.83
3M 3 7 2 0 1.92

Tactile Systems Technology presently has a consensus price target of $76.00, indicating a potential upside of 47.74%. 3M has a consensus price target of $182.50, indicating a potential upside of 13.00%. Given Tactile Systems Technology’s stronger consensus rating and higher possible upside, analysts clearly believe Tactile Systems Technology is more favorable than 3M.

Profitability

This table compares Tactile Systems Technology and 3M’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tactile Systems Technology 5.05% 9.19% 7.53%
3M 15.27% 55.05% 14.52%

Valuation and Earnings

This table compares Tactile Systems Technology and 3M’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tactile Systems Technology $143.75 million 6.74 $6.62 million $0.34 151.29
3M $32.77 billion 2.84 $5.35 billion $10.46 15.44

3M has higher revenue and earnings than Tactile Systems Technology. 3M is trading at a lower price-to-earnings ratio than Tactile Systems Technology, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Tactile Systems Technology has a beta of 1.98, suggesting that its stock price is 98% more volatile than the S&P 500. Comparatively, 3M has a beta of 1.09, suggesting that its stock price is 9% more volatile than the S&P 500.

Institutional & Insider Ownership

98.9% of Tactile Systems Technology shares are held by institutional investors. Comparatively, 67.6% of 3M shares are held by institutional investors. 6.5% of Tactile Systems Technology shares are held by insiders. Comparatively, 0.8% of 3M shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Tactile Systems Technology beats 3M on 9 of the 17 factors compared between the two stocks.

Tactile Systems Technology Company Profile

Tactile Systems Technology, Inc., a medical technology company, develops and provides medical devices for the treatment of chronic diseases in the United States. The company offers Flexitouch system, an at-home solution for lymphedema patients; and ACTitouch system, a home-based solution for chronic venous insufficiency patients. It also provides Entré System, a portable pneumatic compression device that is used for the at-home treatment of venous disorders, such as lymphedema and chronic venous insufficiency, including venous leg ulcers; and Airwear Gradient Compression Wrap management of venous insufficiency, venous hypertension, venous ulcerations and lymphedema under the trade name Aero-Wrap. The company was founded in 1995 and is headquartered in Minneapolis, Minnesota.

3M Company Profile

3M Company operates as a technology company worldwide. The company's Industrial segment offers tapes, abrasives, adhesives, ceramics, sealants, specialty materials, purification products, closure systems, acoustic systems products, automotive components, abrasion-resistant films, and paint finishing and detailing products. Its Safety and Graphics segment provides personal protection and transportation safety products, commercial graphics systems, commercial cleaning and protection products, floor matting, roofing granules, fall protection products, self-contained breathing apparatus systems, and gas and flame detection instruments. The company's Health Care segment offers medical and surgical supplies, skin health and infection prevention products, drug delivery and health information systems, dental and orthodontic products, and food safety products. Its Electronics and Energy segment provides optical films, packaging and interconnection devices, insulating and splicing solutions, touch screens and monitors, renewable energy component solutions, and infrastructure protection products. The company's Consumer segment offers consumer and office tapes and adhesives, repositionable notes, indexing systems, home improvement products, furnace filters, painter tapes, mounting and home care products, sponges, scouring pads, high-performance clothes, protective material products, and adhesive bandages and braces. It also provides cloud-based, conversational artificial intelligence-powered systems. It serves automotive, electronics and automotive electrification, appliance, paper and printing, packaging, food and beverage, construction, medical clinics and hospitals, pharmaceuticals, dental and orthodontic practitioners, health information systems, food manufacturing and testing, consumer and office retail, office business to business, home improvement, drug and pharmacy retail, and other markets. The company was founded in 1902 and is headquartered in St. Paul, Minnesota.

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