Abaxis (ABAX) & Neovasc Inc (US) (NVCN) Critical Analysis

Abaxis (NASDAQ: ABAX) and Neovasc Inc (US) (NASDAQ:NVCN) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Profitability

This table compares Abaxis and Neovasc Inc (US)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Abaxis 10.51% 10.09% 8.69%
Neovasc Inc (US) 268.35% -85.81% 23.39%

Volatility and Risk

Abaxis has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500. Comparatively, Neovasc Inc (US) has a beta of -0.24, suggesting that its share price is 124% less volatile than the S&P 500.

Valuation and Earnings

This table compares Abaxis and Neovasc Inc (US)’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Abaxis $227.22 million 6.56 $32.71 million $1.08 60.76
Neovasc Inc (US) $9.51 million 3.70 -$86.49 million $0.24 1.86

Abaxis has higher revenue and earnings than Neovasc Inc (US). Neovasc Inc (US) is trading at a lower price-to-earnings ratio than Abaxis, indicating that it is currently the more affordable of the two stocks.

Dividends

Abaxis pays an annual dividend of $0.64 per share and has a dividend yield of 1.0%. Neovasc Inc (US) does not pay a dividend. Abaxis pays out 59.3% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current recommendations and price targets for Abaxis and Neovasc Inc (US), as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Abaxis 1 4 1 0 2.00
Neovasc Inc (US) 0 0 4 0 3.00

Abaxis presently has a consensus target price of $54.38, suggesting a potential downside of 17.14%. Neovasc Inc (US) has a consensus target price of $3.35, suggesting a potential upside of 651.96%. Given Neovasc Inc (US)’s stronger consensus rating and higher probable upside, analysts clearly believe Neovasc Inc (US) is more favorable than Abaxis.

Insider & Institutional Ownership

97.7% of Abaxis shares are held by institutional investors. Comparatively, 19.0% of Neovasc Inc (US) shares are held by institutional investors. 4.3% of Abaxis shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Abaxis beats Neovasc Inc (US) on 10 of the 16 factors compared between the two stocks.

About Abaxis

Abaxis, Inc. is a developer, manufacturer and marketer of portable blood analysis systems that are used in medical specialties in human or veterinary patient care to provide clinicians with blood constituent measurements. The Company markets and sells its products around the world through independent distributors and direct sales force. The Company’s segments are the medical market and the veterinary market. The Company’s medical market products include Piccolo chemistry analyzers and consumable products. The Company develops, manufactures and sells the Piccolo Xpress chemistry analyzer for use in human patient care to provide clinicians with blood constituent measurements. The Company’s veterinary market product offerings include VetScan chemistry analyzers and veterinary reagent discs, VetScan hematology instruments and related reagent kits, VetScan VSpro specialty analyzers and related consumables, VetScan i-STAT analyzers and related consumables and VetScan rapid tests.

About Neovasc Inc (US)

Neovasc Inc. (Neovasc) is a specialty medical device company. The Company develops, manufactures and markets products for the cardiovascular marketplace. The Company’s segment is the development, manufacture and marketing of medical devices. Its products include the Tiara technology in development for the transcatheter treatment of mitral valve disease, the Neovasc Reducer for the treatment of refractory angina, and tissue products. The Tiara is in preclinical/early clinical stage development to provide a minimally invasive transcatheter device for patients experiencing mitral regurgitation (MR) as a result of mitral heart valve disease. The Reducer is an hourglass-shaped, balloon-expandable, stainless steel, bare metal device, which is implanted in the coronary sinus, creating a restriction in venous outflow from the myocardium (the muscular layer of the heart wall). Neovasc produces Peripatch, a biological tissue product that is manufactured from pericardium.

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