Vermillion (NASDAQ: VRML) and InVitae Corp (NASDAQ:NVTA) 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, risk, analyst recommendations, profitabiliy, institutional ownership, dividends and earnings.

Profitability

This table compares Vermillion and InVitae Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Vermillion -443.29% -195.68% -118.62%
InVitae Corp -260.48% -119.10% -76.26%

Institutional & Insider Ownership

36.5% of Vermillion shares are owned by institutional investors. 3.7% of Vermillion shares are owned by company 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 current ratings and recommmendations for Vermillion and InVitae Corp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Vermillion 0 0 1 0 3.00
InVitae Corp 0 0 3 0 3.00

Vermillion presently has a consensus price target of $2.00, suggesting a potential upside of 25.79%. InVitae Corp has a consensus price target of $14.00, suggesting a potential upside of 50.05%. Given InVitae Corp’s higher probable upside, analysts clearly believe InVitae Corp is more favorable than Vermillion.

Earnings and Valuation

This table compares Vermillion and InVitae Corp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Vermillion $2.86 million 31.18 -$11.94 million N/A N/A
InVitae Corp $31.43 million 12.56 -$95.64 million N/A N/A

Vermillion has higher revenue, but lower earnings than InVitae Corp.

Summary

InVitae Corp beats Vermillion on 6 of the 10 factors compared between the two stocks.

About Vermillion

Vermillion, Inc. is a diagnostic service and bio-analytic solutions provider. The Company is engaged in the business of developing and commercializing diagnostic tests for gynecologic disease. It sells OVA1 risk of malignancy test for pelvic mass disease (OVA1). OVA1 is a blood test designed to, in addition to a physician’s clinical assessment of a woman with a pelvic mass, identify women who are at risk of having a malignant ovarian tumor prior to planned surgery. It developed OVA1 through pre-clinical studies in collaboration with various academic medical centers encompassing over 2,500 clinical samples. OVA1 is validated in a multi-center clinical trial encompassing approximately 30 sites reflective of the diverse nature of the clinical centers, at which ovarian adnexal masses are evaluated. Its ASPiRA LABS is a laboratory that provides diagnostic services using a biomarker-based diagnostic algorithm to inform clinical decision making and personalized treatment plans.

About InVitae Corp

Invitae Corporation utilizes an integrated portfolio of laboratory processes, software tools and informatics capabilities to process deoxyribonucleic acid (DNA)-containing samples, analyze information about patient-specific genetic variation and generate test reports for clinicians and their patients. As of December 31, 2016, the Company’s products consisted of assays totaling over 1,100 genes that could be used for multiple indications, including hereditary cancer, neurological disorders, cardiovascular disorders, pediatric disorders and other hereditary conditions. The Company offers panels for a range of hereditary conditions in cancer, cardiology, neuromuscular, pediatric and rare diseases. The Company focuses on genetic testing, genome network and genome management. The Company offers full gene sequencing and deletion/duplication analysis as a standard for all of its tests. The Company holds interests in AltaVoice, a patient-centered data company.

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