Establishment Labs (NASDAQ:ESTA) and Embecta (NASDAQ:EMBC) Critical Contrast

Establishment Labs (NASDAQ:ESTA) and Embecta (NASDAQ:EMBC) are both small-cap medical companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, dividends, earnings, profitability and risk.

Earnings & Valuation

This table compares Establishment Labs and Embecta”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Establishment Labs	$211.08 million	9.14	-$51.06 million	($1.49)	-43.99
Embecta	$1.08 billion	0.16	$95.40 million	$1.90	1.53

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

Analyst Recommendations

This is a summary of current ratings and target prices for Establishment Labs and Embecta, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Establishment Labs	1	1	6	0	2.63
Embecta	3	2	0	0	1.40

Establishment Labs currently has a consensus price target of $87.14, indicating a potential upside of 32.94%. Embecta has a consensus price target of $11.00, indicating a potential upside of 279.31%. Given Embecta’s higher probable upside, analysts clearly believe Embecta is more favorable than Establishment Labs.

Volatility & Risk

Establishment Labs has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500. Comparatively, Embecta has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500.

Profitability

This table compares Establishment Labs and Embecta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Establishment Labs	-19.05%	-218.77%	-12.31%
Embecta	10.73%	-23.96%	14.12%

Insider & Institutional Ownership

72.9% of Establishment Labs shares are held by institutional investors. Comparatively, 93.8% of Embecta shares are held by institutional investors. 10.0% of Establishment Labs shares are held by company insiders. Comparatively, 1.3% of Embecta shares are held 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.

Summary

Embecta beats Establishment Labs on 9 of the 14 factors compared between the two stocks.

About Establishment Labs

Establishment Labs Holdings Inc., a medical technology company, manufactures and markets medical devices for aesthetic and reconstructive plastic surgery. The company primarily offers silicone gel-filled breast implants under the Motiva Implants brand. It also provides Motiva Ergonomix and Motiva Ergonomix2 gravity sensitive round soft silicone-gel-filled breast implants; and Motiva Flora Tissue Expander, a breast tissue expander. The company sells its products to physicians, hospitals, and clinics through distributors and direct sales force in Europe, the Middle East, Latin America, and Asia. Establishment Labs Holdings Inc. was incorporated in 2004 and is headquartered in Alajuela, Costa Rica.

About Embecta

Embecta Corp., a medical device company, focuses on the provision of various solutions to enhance the health and wellbeing of people living with diabetes. Its products include pen needles, syringes, and safety injection devices, as well as digital applications to assist people with managing patient's diabetes. The company primarily sells its products to wholesalers and distributors in the United States and internationally. Embecta Corp. was founded in 1924 and is headquartered in Parsippany, New Jersey.