CONMED (NASDAQ: CNMD) and SurModics (NASDAQ:SRDX) are both small-cap medical companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.
This table compares CONMED and SurModics’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
99.0% of CONMED shares are owned by institutional investors. Comparatively, 85.0% of SurModics shares are owned by institutional investors. 2.6% of CONMED shares are owned by insiders. Comparatively, 7.7% of SurModics shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
CONMED pays an annual dividend of $0.80 per share and has a dividend yield of 1.4%. SurModics does not pay a dividend. CONMED pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Risk & Volatility
CONMED has a beta of 0.66, meaning that its share price is 34% less volatile than the S&P 500. Comparatively, SurModics has a beta of 0.85, meaning that its share price is 15% less volatile than the S&P 500.
This is a summary of current ratings and target prices for CONMED and SurModics, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
CONMED presently has a consensus target price of $50.67, suggesting a potential downside of 10.31%. SurModics has a consensus target price of $40.00, suggesting a potential upside of 35.59%. Given SurModics’ stronger consensus rating and higher possible upside, analysts clearly believe SurModics is more favorable than CONMED.
Earnings & Valuation
This table compares CONMED and SurModics’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|CONMED||$763.52 million||2.07||$14.66 million||$0.56||100.88|
|SurModics||$73.11 million||5.33||$3.92 million||$0.29||101.72|
CONMED has higher revenue and earnings than SurModics. CONMED is trading at a lower price-to-earnings ratio than SurModics, indicating that it is currently the more affordable of the two stocks.
SurModics beats CONMED on 10 of the 16 factors compared between the two stocks.
CONMED Corporation is a medical technology company. The Company is engaged in the development, manufacturing and sale on a global basis of surgical devices and related equipment. The Company provides surgical devices and equipment for minimally invasive procedures. The Company’s products are used by surgeons and physicians in a range of specialties, including orthopedics, general surgery, gynecology, neurosurgery and gastroenterology. The Company’s product lines consist of orthopedic surgery, general surgery and surgical visualization. As of December 31, 2016, the Company’s products are distributed domestically directly to over 6,000 hospitals, surgery centers and other healthcare institutions, as well as through medical specialty distributors. The Company’s orthopedic surgery product lines include sports medicine, powered surgical instruments, and sports biologics and tissue. These products are marketed under a range of brands, including Hall, CONMED Linvatec, Concept and Shutt.
Surmodics, Inc. is a provider of medical device and in vitro diagnostic technologies to the healthcare industry. The Company operates through two segments: Medical Device and In Vitro Diagnostics. The Company’s Medical Device segment consists of surface modification coating technologies to improve access, deliverability and predictable deployment of medical devices; international cardiology and peripheral balloon design, development and manufacturing, as well as drug delivery coating technologies to provide site-specific drug delivery from the surface of a medical device. The Company’s In Vitro Diagnostics segment manufactures or sells components for in vitro diagnostic immunoassay and molecular tests. The In Vitro Diagnostics segment manufactures and sells surface coatings to the diagnostic, biomedical research and life science markets. In Vitro Diagnostics segment offers protein stabilization reagents, substrates, antigens and surface coatings.
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