Varex Imaging (NASDAQ:VREX – Get Free Report) and Nuwellis (NASDAQ:NUWE – Get Free Report) are both small-cap healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, analyst recommendations, institutional ownership and dividends.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Varex Imaging and Nuwellis, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Varex Imaging | 0 | 7 | 0 | 0 | 2.00 |
| Nuwellis | 1 | 0 | 0 | 0 | 1.00 |
Varex Imaging presently has a consensus price target of $16.88, suggesting a potential downside of 8.69%. Given Varex Imaging’s stronger consensus rating and higher probable upside, equities analysts plainly believe Varex Imaging is more favorable than Nuwellis.
Volatility & Risk
Profitability
This table compares Varex Imaging and Nuwellis’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Varex Imaging | 2.55% | 9.19% | 4.13% |
| Nuwellis | -123.38% | -623.14% | -147.34% |
Institutional and Insider Ownership
3.1% of Nuwellis shares are owned by institutional investors. 4.6% of Varex Imaging shares are owned by insiders. Comparatively, 1.6% of Nuwellis shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Varex Imaging and Nuwellis”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Varex Imaging | $844.60 million | 0.92 | -$70.30 million | $0.52 | 35.54 |
| Nuwellis | $8.27 million | 0.36 | -$17.52 million | ($132.59) | -0.01 |
Nuwellis has lower revenue, but higher earnings than Varex Imaging. Nuwellis is trading at a lower price-to-earnings ratio than Varex Imaging, indicating that it is currently the more affordable of the two stocks.
Summary
Varex Imaging beats Nuwellis on 11 of the 13 factors compared between the two stocks.
About Varex Imaging
Varex Imaging Corporation designs, manufactures, and sells X-ray imaging components. The company operates through two segments, Medical and Industrial. The Medical segment designs, manufactures, sells, and services X-ray imaging components, comprising X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, collimators, automatic exposure control devices, generators, and heat exchangers. This segment's products are used in a range of applications, including CT, mammography, oncology, cardiac, surgery, dental, and other diagnostic radiography uses. The Industrial segment designs, develops, manufactures, sells, and services Linatron X-ray linear accelerators, X-ray tubes, digital detectors, high voltage connectors, and coolers for use in security and inspection applications, such as baggage screening at airports, cargo screening at ports and borders, and nondestructive testing, irradiation, and inspection in various applications. The company sells its products through imaging system original equipment manufacturers, independent service companies, and distributors, as well as directly to end-users. It has operations in North America, South America, Europe, Russia, the Middle East, India, Africa, Asia, and Australia. Varex Imaging Corporation was incorporated in 2016 and is headquartered in Salt Lake City, Utah.
About Nuwellis
Nuwellis, Inc., a medical device company, develops, manufactures, and commercializes medical devices used in ultrafiltration therapy. The company offers Aquadex FlexFlow and Aquadex SmartFlow systems, which are used to treat patients suffering from fluid overload due to heart failure. Its Aquadex FlexFlow system includes a console, disposable blood circuit set, and disposable catheter. The company sells its products to hospitals and clinics through its direct salesforce in the United States; and through independent specialty distributors in Austria, Belarus, Brazil, Colombia, the Czech Republic, Germany, Greece, Hong Kong, India, Israel, Italy, Panama, Romania, Singapore, Slovakia, Spain, Switzerland, Thailand, the United Arab Emirates, and the United Kingdom. The company was formerly known as CHF Solutions, Inc. and changed its name to Nuwellis, Inc. in April 2021. Nuwellis, Inc. was founded in 1999 and is headquartered in Eden Prairie, Minnesota.
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