IRIDEX (NASDAQ: IRIX) and Accelerate Diagnostics (NASDAQ:AXDX) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, risk, earnings, institutional ownership, analyst recommendations, profitability and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for IRIDEX and Accelerate Diagnostics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IRIDEX 0 0 1 0 3.00
Accelerate Diagnostics 0 0 2 0 3.00

IRIDEX currently has a consensus target price of $13.00, suggesting a potential upside of 49.60%. Accelerate Diagnostics has a consensus target price of $33.00, suggesting a potential upside of 18.71%. Given IRIDEX’s higher probable upside, equities analysts plainly believe IRIDEX is more favorable than Accelerate Diagnostics.

Valuation and Earnings

This table compares IRIDEX and Accelerate Diagnostics’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
IRIDEX $46.16 million 2.18 -$11.71 million ($1.71) -5.08
Accelerate Diagnostics $250,000.00 6,160.48 -$66.37 million ($1.20) -23.17

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

Profitability

This table compares IRIDEX and Accelerate Diagnostics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IRIDEX -42.22% -23.21% -19.03%
Accelerate Diagnostics -3,085.36% -60.99% -57.85%

Volatility and Risk

IRIDEX has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500. Comparatively, Accelerate Diagnostics has a beta of 2.15, suggesting that its stock price is 115% more volatile than the S&P 500.

Institutional and Insider Ownership

49.3% of IRIDEX shares are owned by institutional investors. Comparatively, 47.9% of Accelerate Diagnostics shares are owned by institutional investors. 5.0% of IRIDEX shares are owned by insiders. Comparatively, 50.0% of Accelerate Diagnostics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

IRIDEX beats Accelerate Diagnostics on 7 of the 12 factors compared between the two stocks.

About IRIDEX

IRIDEX Corporation is a provider of therapeutic based laser consoles, delivery devices and consumable instrumentation used to treat sight-threatening eye diseases in ophthalmology. The Company operates through ophthalmology segment. Its ophthalmology products consist of laser consoles, delivery devices and consumable instrumentation, including laser probes, and are used in the treatment of serious eye diseases, including the over three causes of irreversible blindness, such as diabetic retinopathy, glaucoma and age-related macular degeneration (AMD). In addition, the Company’s ophthalmology products are often used in vitrectomy procedures (used to treat proliferative diabetic retinopathy, macular holes, retinal tears and detachments), which are generally performed in the operating room and require a consumable single use intraocular laser probe (EndoProbe) to deliver light to the back of the eye together with other instrumentation.

About Accelerate Diagnostics

Accelerate Diagnostics, Inc. is an in vitro diagnostics company engaged in providing solutions that develop patient outcomes through the diagnosis of serious infections. The Company’s in vitro diagnostic platform, the Accelerate Pheno system utilizes genotypic technology to identify (ID), infectious pathogens and phenotypic technology to conduct antibiotic susceptibility testing (AST), which determines whether live bacterial or fungal cells are resistant or susceptible to a particular antibiotic. It detects and identifies pathogens directly from a single patient sample followed by antimicrobial susceptibility testing based on the identification results. The Accelerate PhenoTest BC Kit provides ID and AST results for patients suspected of bacteremia or fungemia, both life-threatening conditions with high morbidity and mortality risk. The Accelerate Pheno system features walk-away automation and consists of a fixed instrument and single-use test kit.

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