Rockwell Medical (NASDAQ: RMTI) and Check-Cap (NASDAQ:CHEK) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Volatility & Risk

Rockwell Medical has a beta of 2.04, indicating that its stock price is 104% more volatile than the S&P 500. Comparatively, Check-Cap has a beta of -0.37, indicating that its stock price is 137% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Rockwell Medical and Check-Cap, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rockwell Medical 1 0 1 1 2.67
Check-Cap 0 0 3 0 3.00

Rockwell Medical currently has a consensus target price of $9.33, indicating a potential upside of 40.35%. Check-Cap has a consensus target price of $6.00, indicating a potential upside of 246.82%. Given Check-Cap’s stronger consensus rating and higher possible upside, analysts clearly believe Check-Cap is more favorable than Rockwell Medical.

Profitability

This table compares Rockwell Medical and Check-Cap’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rockwell Medical -39.68% -42.22% -27.15%
Check-Cap N/A -98.88% -80.97%

Insider & Institutional Ownership

20.5% of Rockwell Medical shares are held by institutional investors. Comparatively, 13.4% of Check-Cap shares are held by institutional investors. 15.9% of Rockwell Medical shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Rockwell Medical and Check-Cap’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Rockwell Medical $54.04 million 6.37 -$21.07 million ($0.42) -15.83
Check-Cap N/A N/A -$9.62 million ($0.59) -2.93

Check-Cap has higher revenue, but lower earnings than Rockwell Medical. Rockwell Medical is trading at a lower price-to-earnings ratio than Check-Cap, indicating that it is currently the more affordable of the two stocks.

Summary

Rockwell Medical beats Check-Cap on 8 of the 13 factors compared between the two stocks.

Rockwell Medical Company Profile

Rockwell Medical, Inc. (Rockwell) is a biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with products and services for the treatment of iron deficiency, secondary hyperparathyroidism and hemodialysis. The Company operates through the hemodialysis market segment, which involves the manufacture, sale and distribution of hemodialysis products to hemodialysis clinics, including pharmaceutical, dialysis concentrates, dialysis kits and other ancillary products used in the dialysis process. The Company’s drug products include Triferic (ferric pyrophosphate citrate) and Calcitriol (Active Vitamin D) Injection. Triferic is an iron compound that is delivered to hemodialysis patients through dialysate, replacing the iron loss that occurs during their dialysis treatment. Calcitriol (active vitamin D) injection is indicated for treatment of secondary hyperparathyroidism in dialysis patients.

Check-Cap Company Profile

Check-Cap Ltd. (Check-Cap) is a clinical-stage medical diagnostics company. The Company is engaged in the development of an ingestible imaging capsule that utilizes low-dose X-rays for the detection and imaging of colonic polyps and colorectal cancers, or CRC. The Company’s system consists of main components, such as ingestible scanning capsule; Capsule Positioning System (CPS), a recorder worn on the patient’s back, and a personal computer (PC)-based work station for data reconstruction and image processing. The Company’s scanning capsule will be swallowed and propelled by natural motility through the gastrointestinal tract and excreted naturally with no need for retrieval for data collection. Its scanning capsule employs low-dose X-rays, which allow the system to image the interior lining of the colon even when surrounded by intestinal content. Its capsule transmits information to a receiving device worn on the patient’s body that stores the information for off-line analysis.

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