Globus Medical (NYSE: GMED) and NeuroMetrix (NASDAQ:NURO) are both medical companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Institutional and Insider Ownership

72.2% of Globus Medical shares are held by institutional investors. Comparatively, 12.0% of NeuroMetrix shares are held by institutional investors. 28.2% of Globus Medical shares are held by insiders. Comparatively, 4.4% of NeuroMetrix shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Globus Medical and NeuroMetrix, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Globus Medical 1 4 7 0 2.50
NeuroMetrix 0 0 1 0 3.00

Globus Medical presently has a consensus target price of $36.83, suggesting a potential downside of 4.15%. NeuroMetrix has a consensus target price of $3.00, suggesting a potential upside of 72.41%. Given NeuroMetrix’s stronger consensus rating and higher probable upside, analysts plainly believe NeuroMetrix is more favorable than Globus Medical.

Earnings & Valuation

This table compares Globus Medical and NeuroMetrix’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Globus Medical $563.99 million 6.57 $104.34 million $1.10 34.94
NeuroMetrix $12.03 million 0.34 -$14.91 million ($17.04) -0.10

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

Risk and Volatility

Globus Medical has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500. Comparatively, NeuroMetrix has a beta of 0.33, meaning that its share price is 67% less volatile than the S&P 500.

Profitability

This table compares Globus Medical and NeuroMetrix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Globus Medical 17.54% 13.67% 12.35%
NeuroMetrix -80.57% -232.71% -140.16%

Summary

Globus Medical beats NeuroMetrix on 11 of the 13 factors compared between the two stocks.

About Globus Medical

Globus Medical, Inc. (Globus) is a medical device company focused on the design, development and commercialization of musculoskeletal implants that promote healing in patients with spine disorders. The Company is focused on implants that promote healing in patients with spine disorders. The Company’s products fall into one of two categories: Innovative Fusion or Disruptive Technologies. The Company sells its products through exclusive sales force in the United States, as well as within North, Central & South America, Europe, Asia, Africa and Australia. The sales force consists of direct sales representatives and distributor sales representatives employed by exclusive independent distributors.

About NeuroMetrix

NeuroMetrix, Inc. is a healthcare company combining bioelectrical and digital medicine to address chronic health conditions, including chronic pain, sleep disorders and diabetes. The Company is engaged in the sale of medical equipment, and consumables and accessories. It has two principal product lines: Wearable neuro-stimulation therapeutic devices and Point-of-care neuropathy diagnostic tests. Its products include ADVANCE NCS/EMG System (the ADVANCE System), Quell, SENSUS and DPNCheck. Quell is a wearable device for relief of chronic intractable pain, such as nerve pain due to diabetes and lower back problems. The SENSUS pain therapy device, the technological predecessor to Quell, is a prescription neuro-stimulation device based on transcutaneous electrical nerve stimulation (TENS) for relief of chronic, intractable pain. DPNCheck is a quantitative nerve conduction test. ADVANCE System is a platform for the performance of traditional nerve conduction studies.

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