Financial Contrast: Neovasc (NASDAQ:NVCN) vs. SurModics (NASDAQ:SRDX)

Neovasc (NASDAQ:NVCN) and SurModics (NASDAQ:SRDX) are both small-cap medical companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, dividends, valuation and profitability.

Risk and Volatility

Neovasc has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500. Comparatively, SurModics has a beta of 1.22, suggesting that its share price is 22% more volatile than the S&P 500.

Insider & Institutional Ownership

10.0% of Neovasc shares are owned by institutional investors. Comparatively, 86.6% of SurModics shares are owned by institutional investors. 6.3% of SurModics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Neovasc and SurModics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Neovasc 0 0 0 0 N/A
SurModics 0 0 3 0 3.00

SurModics has a consensus price target of $68.00, suggesting a potential upside of 63.07%. Given SurModics’ higher probable upside, analysts clearly believe SurModics is more favorable than Neovasc.

Profitability

This table compares Neovasc and SurModics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Neovasc -2,977.34% N/A -165.43%
SurModics -2.07% 6.35% 4.53%

Earnings & Valuation

This table compares Neovasc and SurModics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Neovasc $1.75 million 11.67 -$108.04 million ($27.30) -0.10
SurModics $81.34 million 6.91 -$4.45 million $0.49 85.10

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

Summary

SurModics beats Neovasc on 11 of the 13 factors compared between the two stocks.

About Neovasc

Neovasc Inc., a specialty medical device company, develops, manufactures, and markets cardiovascular devices worldwide. Its products include the Tiara technology for the transcatheter treatment of mitral valve disease; and the Neovasc Reducer for the treatment of refractory angina. The company also provides Peripatch tissue products. The company was formerly known as Medical Ventures Corp. and changed its name to Neovasc Inc. in July 2008. Neovasc Inc. was incorporated in 2000 and is headquartered in Richmond, Canada.

About SurModics

Surmodics, Inc., together with its subsidiaries, provides medical devices and in vitro diagnostic technologies to the healthcare industry in the United States and internationally. The company operates through two segments, Medical Device and In Vitro Diagnostics. The Medical Device segment designs, develops, and manufactures interventional medical devices primarily for the peripheral vascular market; and offers surface modification coating technologies to enhance access, deliverability, and predictable deployment of medical devices, as well as drug delivery coating technologies to provide site-specific drug delivery from the surface of a medical device for the coronary, peripheral, neuro-vascular, urology, and other markets. The Vitro Diagnostics segment provides stabilization products, substrates, antigens, and surface coatings to diagnostics customers; and manufactures or sells components for in vitro diagnostic immunoassay and molecular tests, as well as surface coatings to the diagnostic, biomedical research, and life science markets. Surmodics, Inc. was founded in 1979 and is headquartered in Eden Prairie, Minnesota.

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