GenMark Diagnostics (NASDAQ: GNMK) and Quidel Corporation (NASDAQ:QDEL) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.

Valuation and Earnings

This table compares GenMark Diagnostics and Quidel Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
GenMark Diagnostics $50.59 million 10.51 -$49.93 million ($1.21) -8.04
Quidel Corporation $214.11 million 6.71 $39.38 million ($0.01) -4,293.71

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

Institutional and Insider Ownership

87.2% of Quidel Corporation shares are owned by institutional investors. 7.5% of GenMark Diagnostics shares are owned by company insiders. Comparatively, 22.0% of Quidel Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares GenMark Diagnostics and Quidel Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GenMark Diagnostics -111.96% -109.89% -60.26%
Quidel Corporation -0.03% -0.03% -0.02%

Risk and Volatility

GenMark Diagnostics has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500. Comparatively, Quidel Corporation has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for GenMark Diagnostics and Quidel Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GenMark Diagnostics 0 0 5 0 3.00
Quidel Corporation 0 1 5 0 2.83

GenMark Diagnostics currently has a consensus target price of $14.40, indicating a potential upside of 48.00%. Quidel Corporation has a consensus target price of $47.50, indicating a potential upside of 10.52%. Given GenMark Diagnostics’ stronger consensus rating and higher possible upside, equities analysts clearly believe GenMark Diagnostics is more favorable than Quidel Corporation.

Summary

Quidel Corporation beats GenMark Diagnostics on 9 of the 12 factors compared between the two stocks.

GenMark Diagnostics Company Profile

GenMark Diagnostics, Inc. is a molecular diagnostics company. The Company is focused on developing and commercializing multiplex molecular tests that aid in the diagnosis of complex medical conditions. It develops and commercializes multiplex molecular tests based on its eSensor electrochemical detection technology. It offers four Food and Drug Administration (FDA)-cleared diagnostic tests which run on its XT-8 instrument; its Respiratory Viral Panel; its Cystic Fibrosis Genotyping Test; its Warfarin Sensitivity Test, and its Thrombophilia Risk Test. It also offers a Hepatitis C (HCV) genotyping test and associated custom manufactured reagents, as well as a 2C19 Genotyping Test, versions of which are available for use with its XT-8 instrument for research use only (RUO). Its XT-8 and ePlex test cartridges utilize the combination of distinct electrodes and multiple signal probes to detect dozens of target biomarkers from a single sample, thereby enabling highly multiplexed testing.

Quidel Corporation Company Profile

Quidel Corporation is engaged in the development, manufacturing and marketing of diagnostic testing solutions. These diagnostic testing solutions are separated into four product categories: immunoassays, molecular assays, virology and specialty products. The Company sells its products directly to end users and distributors, in each case, for professional use in physician offices, hospitals, clinical laboratories, reference laboratories, universities, retail clinics, pharmacies and wellness screening centers. Its diagnostic solutions aid in the detection and diagnosis of critical diseases and other medical conditions, including infectious diseases, women’s health, gastrointestinal diseases, autoimmune diseases, bone health and thyroid diseases. The Company provides diagnostic testing solutions under various brand names, including Quidel, QuickVue, QuickVue+, MicroVue, FreshCells, D3 FastPoint, Super E-Mix, ELVIS, Sofia, Quidel Molecular, Amplivue, Lyra and Thyretain.

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