Critical Contrast: Rockwell Medical (NASDAQ:RMTI) vs. Butterfly Network (NYSE:BFLY)

Rockwell Medical (NASDAQ:RMTI) and Butterfly Network (NYSE:BFLY) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, profitability, risk, analyst recommendations, institutional ownership, dividends and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Rockwell Medical and Butterfly Network, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rockwell Medical	1	0	1	0	2.00
Butterfly Network	1	1	3	0	2.40

Rockwell Medical presently has a consensus target price of $20.00, indicating a potential upside of 150.31%. Butterfly Network has a consensus target price of $5.56, indicating a potential downside of 23.38%. Given Rockwell Medical’s higher probable upside, research analysts plainly believe Rockwell Medical is more favorable than Butterfly Network.

Institutional and Insider Ownership

23.3% of Rockwell Medical shares are owned by institutional investors. Comparatively, 37.9% of Butterfly Network shares are owned by institutional investors. 4.6% of Rockwell Medical shares are owned by insiders. Comparatively, 22.0% of Butterfly Network shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Rockwell Medical and Butterfly Network”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rockwell Medical	$69.39 million	0.46	-$5.31 million	($1.34)	-5.96
Butterfly Network	$97.61 million	19.81	-$77.06 million	($0.29)	-25.03

Rockwell Medical has higher earnings, but lower revenue than Butterfly Network. Butterfly Network is trading at a lower price-to-earnings ratio than Rockwell Medical, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Rockwell Medical has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500. Comparatively, Butterfly Network has a beta of 2.08, indicating that its stock price is 108% more volatile than the S&P 500.

Profitability

This table compares Rockwell Medical and Butterfly Network’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rockwell Medical	-7.33%	-14.03%	-8.90%
Butterfly Network	-66.74%	-33.99%	-22.96%

Summary

Butterfly Network beats Rockwell Medical on 8 of the 14 factors compared between the two stocks.

About Rockwell Medical

Rockwell Medical, Inc., together with its subsidiaries, operates as a healthcare company that engages in the development, manufacture, commercialization, and distribution of various hemodialysis products for dialysis providers worldwide. The company offers Triferic Dialysate and Triferic AVNU which are indicated to maintain hemoglobin in adult undergoing hemodialysis. It also manufactures, sells, delivers, and distributes hemodialysis concentrates, such as CitraPure citric acid concentrate, Dri-Sate dry acid concentrate, RenalPure liquid acid concentrate, dry acid concentrate mixer, and RenalPure and SteriLyte powder bicarbonate concentrate; and ancillary products, including testing supplies, 5% acetic acid cleaning solution, 5% and 2% citric acid descaler, filtration salts, and other items used by hemodialysis providers. The company's hemodialysis concentrate products are used to sustain patient's life by removing toxins and balancing electrolytes in a dialysis patient's bloodstream. The company serves to hemodialysis clinics. Rockwell Medical, Inc. was incorporated in 1996 and is headquartered in Wixom, Michigan.

About Butterfly Network

Butterfly Network, Inc. develops, manufactures, and commercializes ultrasound imaging solutions in the United States and internationally. It offers Butterfly iQ, a handheld and single-probe whole body ultrasound system; Butterfly iQ+ and iQ3 ultrasound devices that can perform whole-body imaging in a single handheld probe integrated with the clinical workflow, and accessible on a user's smartphone, tablet, and almost any hospital computer system; and Butterfly iQ+ Vet, a handheld ultrasound system designed for veterinarians. The company also provides Butterfly system, which includes probes, and related accessories and software subscriptions to healthcare systems, physicians, and healthcare providers through a direct sales force, distributors, and eCommerce channel. In addition, it offers cloud-based software solutions to healthcare systems, teleguidance, in-app educational tutorials, and formal education programs through its Butterfly Academy software, as well as professional services for large scale deployments; and ScanLab, an education-only app provides written walkthroughs and reference imagery to guide real-time educational scanning, enhancing the learning process. Butterfly Network, Inc. was founded in 2011 and is headquartered in Burlington, Massachusetts.