Neurometrix (NASDAQ:NURO) and Accuray (NASDAQ:ARAY) are both small-cap medical companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, earnings, risk and analyst recommendations.

Institutional & Insider Ownership

16.9% of Neurometrix shares are owned by institutional investors. Comparatively, 79.0% of Accuray shares are owned by institutional investors. 6.4% of Neurometrix shares are owned by insiders. Comparatively, 3.3% of Accuray shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Neurometrix and Accuray, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Neurometrix 0 0 1 0 3.00
Accuray 0 3 0 0 2.00

Neurometrix currently has a consensus target price of $5.00, suggesting a potential upside of 1,751.85%. Accuray has a consensus target price of $3.95, suggesting a potential upside of 45.19%. Given Neurometrix’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Neurometrix is more favorable than Accuray.

Valuation and Earnings

This table compares Neurometrix and Accuray’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Neurometrix $16.09 million 0.16 $20,000.00 N/A N/A
Accuray $418.79 million 0.58 -$16.43 million ($0.15) -18.14

Neurometrix has higher earnings, but lower revenue than Accuray.

Profitability

This table compares Neurometrix and Accuray’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Neurometrix -48.86% -58.03% -30.15%
Accuray -3.92% -26.69% -3.18%

Risk and Volatility

Neurometrix has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500. Comparatively, Accuray has a beta of 1.94, meaning that its share price is 94% more volatile than the S&P 500.

Summary

Accuray beats Neurometrix on 7 of the 12 factors compared between the two stocks.

Neurometrix Company Profile

NeuroMetrix, Inc., a healthcare company, develops and markets products for the detection, diagnosis, and monitoring of peripheral nerve and spinal cord disorders. The company develops wearable neuro-stimulation therapeutic devices and point-of-care neuropathy diagnostic tests to address chronic health conditions, including chronic pain, sleep disorders, and diabetes. Its marketed products include Quell, a wearable device for relief of chronic intractable pain, such as nerve pain due to diabetes and lower back problems; DPNCheck, a test used to evaluate systemic neuropathies, such as diabetic peripheral neuropathy; ADVANCE system, a platform for the performance of traditional nerve conduction studies; and SENSUS, a pain therapy device based on transcutaneous electrical nerve stimulation for relief of chronic intractable pain. The company offers its products to consumers, retail merchandisers, direct response TV promoters, health care professionals, managed care organizations, endocrinologists, podiatrists, physicians, neurologists, and physical medicine and rehabilitation centers, as well as primary care, internal medicine, orthopedic, hand, and neurosurgeons. It operates in the United States, Europe, Japan, China, the Middle East, and Mexico. The company has a strategic collaboration with GlaxoSmithKline. NeuroMetrix, Inc. was founded in 1996 and is headquartered in Waltham, Massachusetts.

Accuray Company Profile

Accuray Incorporated designs, develops, and sells radiosurgery and radiation therapy systems for the treatment of tumors in the body. The company offers the CyberKnife System, a robotic stereotactic radiosurgery and stereotactic body radiation therapy system used for the treatment of various types of cancer and tumors in the body. The CyberKnife System automatically tracks, detects, and corrects for tumor and patient movement in real-time during the procedure, as well as enables the delivery of precise, high dose radiation while patients breathe normally. It also offers the TomoTherapy System, which consists of an integrated and versatile radiation therapy system used for the treatment of a range of cancer types. The company markets its products in the United States directly, as well as through a sales agent and group purchasing organizations; and directly and through distributors and sales agents in Europe, Japan and other countries of Asia, South America, and internationally to hospitals and stand-alone treatment facilities. Accuray Incorporated was incorporated in 1990 and is headquartered in Sunnyvale, California.

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