NxStage Medical (NASDAQ: NXTM) and Novadaq Technologies (NASDAQ:NVDQ) are both small-cap medical companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares NxStage Medical and Novadaq Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NxStage Medical -1.33% -2.43% -1.56%
Novadaq Technologies -66.61% -51.89% -40.92%

Insider and Institutional Ownership

91.8% of NxStage Medical shares are held by institutional investors. Comparatively, 86.5% of Novadaq Technologies shares are held by institutional investors. 4.7% of NxStage Medical shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for NxStage Medical and Novadaq Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NxStage Medical 0 7 0 0 2.00
Novadaq Technologies 0 11 2 0 2.15

NxStage Medical presently has a consensus target price of $29.83, indicating a potential upside of 1.99%. Novadaq Technologies has a consensus target price of $11.86, indicating a potential upside of 2.57%. Given Novadaq Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe Novadaq Technologies is more favorable than NxStage Medical.

Risk and Volatility

NxStage Medical has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500. Comparatively, Novadaq Technologies has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500.

Earnings & Valuation

This table compares NxStage Medical and Novadaq Technologies’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
NxStage Medical $378.01 million 5.11 $14.26 million ($0.07) -417.86
Novadaq Technologies $83.87 million 7.97 -$50.47 million ($0.96) -12.04

NxStage Medical has higher revenue and earnings than Novadaq Technologies. NxStage Medical is trading at a lower price-to-earnings ratio than Novadaq Technologies, indicating that it is currently the more affordable of the two stocks.

Summary

NxStage Medical beats Novadaq Technologies on 8 of the 13 factors compared between the two stocks.

About NxStage Medical

NxStage Medical, Inc. is a medical technology company. The Company develops, manufactures and markets products and services for patients suffering from chronic or acute kidney failure. It operates through three segments. The System One segment includes revenues from the sale and rental of the System One and PureFlow SL dialysate preparation equipment and the sale of disposable products in the home and critical care markets. The In-Center segment includes revenues from the sale of blood tubing sets and needles for hemodialysis, primarily for the treatment of end-stage renal disease patients at dialysis clinics, and needles for apheresis. It markets extracorporeal disposable products under the Medisystems brand. The Services segment includes revenues from dialysis services provided to patients at its NxStage Kidney Care dialysis centers. Its product offerings include Home Dialysis, Next-Generation Hemodialysis System, Critical Care, Next-Generation Critical Care System and In-Center.

About Novadaq Technologies

NOVADAQ Technologies Inc. is a medical device company. The Company primarily develops, manufactures and markets real-time fluorescence imaging products that are designed for use by surgeons in the operating room and other clinical settings where open and minimally invasive surgery or interventional procedures are performed. The Company’s SPY fluorescence imaging technology platform (SPY Fluorescence Imaging) provides clinically relevant anatomic and physiologic images of blood flow in vessels and micro-vessels during a range of surgical and outpatient procedures performed in the operating room or clinic. The SPY Fluorescence Imaging platform can be used to develop imaging devices specifically designed to meet the needs of different surgeons and other healthcare providers and the specialty procedures they perform. SPY images enable physicians treating life-threatening illnesses, such as breast, head and neck, colon, complex hernias, diabetes and certain cardiovascular diseases.

Receive News & Ratings for NxStage Medical Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for NxStage Medical Inc. and related companies with MarketBeat.com's FREE daily email newsletter.