CONMED Corporation (NASDAQ: CNMD) and NeuroMetrix (NASDAQ:NURO) are both small-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitability and risk.

Insider & Institutional Ownership

98.3% of CONMED Corporation shares are owned by institutional investors. Comparatively, 6.5% of NeuroMetrix shares are owned by institutional investors. 2.6% of CONMED Corporation shares are owned by company insiders. Comparatively, 4.4% of NeuroMetrix shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and target prices for CONMED Corporation and NeuroMetrix, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CONMED Corporation 0 3 1 0 2.25
NeuroMetrix 0 0 2 0 3.00

CONMED Corporation currently has a consensus price target of $49.33, indicating a potential downside of 9.05%. NeuroMetrix has a consensus price target of $26.00, indicating a potential upside of 1,282.98%. Given NeuroMetrix’s stronger consensus rating and higher possible upside, analysts clearly believe NeuroMetrix is more favorable than CONMED Corporation.

Valuation & Earnings

This table compares CONMED Corporation and NeuroMetrix’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
CONMED Corporation $772.61 million 1.96 $123.91 million $0.56 96.86
NeuroMetrix $15.72 million 0.22 -$13.27 million ($20.01) -0.09

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

Volatility & Risk

CONMED Corporation has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500. Comparatively, NeuroMetrix has a beta of 0.41, meaning that its stock price is 59% less volatile than the S&P 500.

Profitability

This table compares CONMED Corporation and NeuroMetrix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CONMED Corporation 2.02% 8.38% 3.66%
NeuroMetrix -83.92% -209.56% -135.03%

Dividends

CONMED Corporation pays an annual dividend of $0.80 per share and has a dividend yield of 1.5%. NeuroMetrix does not pay a dividend. CONMED Corporation pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

CONMED Corporation beats NeuroMetrix on 10 of the 15 factors compared between the two stocks.

CONMED Corporation Company Profile

CONMED Corporation is a medical technology company. The Company is engaged in the development, manufacturing and sale on a global basis of surgical devices and related equipment. The Company provides surgical devices and equipment for minimally invasive procedures. The Company’s products are used by surgeons and physicians in a range of specialties, including orthopedics, general surgery, gynecology, neurosurgery and gastroenterology. The Company’s product lines consist of orthopedic surgery, general surgery and surgical visualization. As of December 31, 2016, the Company’s products are distributed domestically directly to over 6,000 hospitals, surgery centers and other healthcare institutions, as well as through medical specialty distributors. The Company’s orthopedic surgery product lines include sports medicine, powered surgical instruments, and sports biologics and tissue. These products are marketed under a range of brands, including Hall, CONMED Linvatec, Concept and Shutt.

NeuroMetrix Company Profile

NeuroMetrix, Inc. is a healthcare company combining bioelectrical and digital medicine to address chronic health conditions, including chronic pain, sleep disorders and diabetes. The Company is engaged in the sale of medical equipment, and consumables and accessories. It has two principal product lines: Wearable neuro-stimulation therapeutic devices and Point-of-care neuropathy diagnostic tests. Its products include ADVANCE NCS/EMG System (the ADVANCE System), Quell, SENSUS and DPNCheck. Quell is a wearable device for relief of chronic intractable pain, such as nerve pain due to diabetes and lower back problems. The SENSUS pain therapy device, the technological predecessor to Quell, is a prescription neuro-stimulation device based on transcutaneous electrical nerve stimulation (TENS) for relief of chronic, intractable pain. DPNCheck is a quantitative nerve conduction test. ADVANCE System is a platform for the performance of traditional nerve conduction studies.

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