Exactech (NASDAQ: EXAC) and Transenterix (NASDAQ:TRXC) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, dividends and valuation.

Profitability

This table compares Exactech and Transenterix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Exactech 0.30% 7.39% 5.98%
Transenterix -928.85% -49.16% -33.51%

Institutional & Insider Ownership

64.6% of Exactech shares are held by institutional investors. 28.3% of Exactech shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Exactech and Transenterix, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Exactech 0 0 1 0 3.00
Transenterix 0 1 0 0 2.00

Transenterix has a consensus price target of $0.70, suggesting a potential downside of 51.05%. Given Transenterix’s higher possible upside, analysts clearly believe Transenterix is more favorable than Exactech.

Valuation & Earnings

This table compares Exactech and Transenterix’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Exactech $262.96 million 1.65 $43.51 million $0.04 755.19
Transenterix $5.05 million 42.06 -$47.82 million N/A N/A

Exactech has higher revenue and earnings than Transenterix.

Summary

Exactech beats Transenterix on 9 of the 11 factors compared between the two stocks.

Exactech Company Profile

Exactech, Inc. develops, manufactures, markets, distributes and sells orthopedic implant devices, related surgical instrumentation and biologic services to hospitals and physicians. The Company’s segments include knee, hip, biologics and spine, extremity and other products. Its other products segment includes miscellaneous sales categories, such as bone cement, instrument rental fees, shipping charges and other product lines. The Company distributes joint replacement systems, including knee, hip, spine and extremity implant systems, and biologic products and services and bone cement materials used in orthopedic surgery and dental procedures. The Exactech Knee System provides solutions for partial, primary and revision total knee arthroplasty. Its hip solutions address the continuum of hip arthroplasty. It manufactures and distributes various products and services designed for the healing and regeneration of bone and soft tissue, including products, which contain human allograft.

Transenterix Company Profile

TransEnterix, Inc. is a medical device company. The Company is focused on the development and commercialization of ALF-X Surgical Robotic System (the ALF-X System), and SurgiBot System. The Company’s ALF-X System is a multi-port robotic surgery system, which allows multiple robotic arms to control instruments and a camera. The system features advanced technology to enable surgeons with haptic feedback and the ability to move the camera through eye movement. The system replicates laparoscopic motion and integrates three-dimensional high definition (3DHD) vision technology. The ALF-X System also offers responsible economics to hospitals by offering robotic technology with reusable instruments. The SurgiBot System is designed as a single-incision, patient-side robotic-assisted surgery system. The Company also develops and manufactures laparoscopic surgical instruments that are used in abdominal surgery, such as scissors, graspers, clip appliers, and suction and irrigation instruments.

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