Natera (NASDAQ: NTRA) and Lantheus Holdings (NASDAQ:LNTH) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitabiliy, dividends, risk and institutional ownership.

Profitability

This table compares Natera and Lantheus Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Natera -60.89% -101.63% -55.28%
Lantheus Holdings 6.71% -24.06% 11.69%

Risk & Volatility

Natera has a beta of 2.6, indicating that its share price is 160% more volatile than the S&P 500. Comparatively, Lantheus Holdings has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Natera and Lantheus Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Natera 0 0 4 0 3.00
Lantheus Holdings 0 1 3 0 2.75

Natera currently has a consensus price target of $17.50, suggesting a potential upside of 61.29%. Lantheus Holdings has a consensus price target of $15.25, suggesting a potential downside of 17.34%. Given Natera’s stronger consensus rating and higher probable upside, research analysts plainly believe Natera is more favorable than Lantheus Holdings.

Earnings and Valuation

This table compares Natera and Lantheus Holdings’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Natera $202.07 million 2.84 -$114.96 million ($2.38) -4.56
Lantheus Holdings $306.74 million 2.24 $70.60 million $0.61 30.25

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

Institutional and Insider Ownership

59.6% of Natera shares are owned by institutional investors. Comparatively, 64.4% of Lantheus Holdings shares are owned by institutional investors. 18.9% of Natera shares are owned by insiders. Comparatively, 2.3% of Lantheus Holdings shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Lantheus Holdings beats Natera on 7 of the 13 factors compared between the two stocks.

About Natera

Natera, Inc. is a diagnostics company. The Company is engaged in the discovery, development and commercialization of genetic testing services. It offers Panorama Non-Invasive Prenatal Test that screens for chromosomal abnormalities of a fetus with a blood draw from the mother; Horizon Carrier Screening to determine carrier status for a large number of severe genetic diseases that could be passed on to the carrier’s children; Spectrum Pre-implantation Genetic Screening and Spectrum Pre-implantation Genetic Diagnosis to analyze chromosomal anomalies or inherited genetic conditions during an in vitro fertilization cycle to select embryos with the probability of becoming healthy children; Anora Products of Conception test to analyze fetal chromosomes to understand the cause of miscarriage, and Non-Invasive Paternity Testing, to determine paternity by analyzing the fragments of fetal deoxyribonucleic acid in a pregnant mother’s blood and a blood sample from the alleged father(s).

About Lantheus Holdings

Lantheus Holdings, Inc. is engaged in the development, manufacture and commercialization of diagnostic medical imaging agents and products that assist clinicians in the diagnosis and treatment of cardiovascular and other diseases. Its imaging agents and products are used across a range of imaging modalities, including echocardiography and nuclear imaging. It operates in two segments: U.S. Segment and International Segment. The U.S. Segment produces and markets its medical imaging agents and products throughout the United States. In the United States, it sells its products to radiopharmacies, integrated delivery networks, hospitals, clinics and group practices. The International Segment operations consist of production and distribution activities in Puerto Rico and direct distribution activities in Canada. Its portfolio of nine commercial products is diversified across a range of imaging modalities. Its products include an ultrasound contrast agent and medical radiopharmaceuticals.

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