Critical Comparison: Nihon Kohden (OTCMKTS:NHNKY) and OrthoPediatrics (NASDAQ:KIDS)

OrthoPediatrics (NASDAQ:KIDS) and Nihon Kohden (OTCMKTS:NHNKY) are both small-cap medical companies, but which is the better business? We will compare the two companies based on the strength of their profitability, risk, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent ratings and target prices for OrthoPediatrics and Nihon Kohden, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OrthoPediatrics	1	1	9	0	2.73
Nihon Kohden	0	1	0	1	3.00

OrthoPediatrics currently has a consensus price target of $24.44, indicating a potential upside of 17.98%. Given OrthoPediatrics’ higher probable upside, equities research analysts plainly believe OrthoPediatrics is more favorable than Nihon Kohden.

Institutional and Insider Ownership

69.1% of OrthoPediatrics shares are owned by institutional investors. Comparatively, 0.1% of Nihon Kohden shares are owned by institutional investors. 31.8% of OrthoPediatrics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

OrthoPediatrics has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Nihon Kohden has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500.

Profitability

This table compares OrthoPediatrics and Nihon Kohden’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OrthoPediatrics	-16.31%	-7.01%	-4.86%
Nihon Kohden	6.08%	9.46%	6.68%

Earnings & Valuation

This table compares OrthoPediatrics and Nihon Kohden”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OrthoPediatrics	$236.35 million	2.25	-$39.65 million	($1.68)	-12.33
Nihon Kohden	$1.56 billion	1.02	$95.79 million	$0.59	16.00

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

Summary

Nihon Kohden beats OrthoPediatrics on 9 of the 15 factors compared between the two stocks.

About OrthoPediatrics

OrthoPediatrics Corp., a medical device company, engages in designing, developing, and marketing anatomically appropriate implants, instruments, and specialized braces for children with orthopedic conditions in the United States and internationally. The company offers pediatric trauma and deformity correction products; scoliosis procedures for the treatment of spinal deformity; and sports medicine and other products. Its products comprise PediLoc, PediPlates, cannulated screws, PediFlex nail, PediNail, PediLoc Tibia, ACL Reconstruction System, Locking Cannulated Blade, Locking Proximal Femur, Spica Tables, RESPONSE Spine, BandLoc, Pediguard, Pediatric Nailing Platform | Femur, Devise Rail, Orthex, The Fassier-Duval Telescopic Intramedullary System, SLIMTM Nail, The GAP Nail, The Free Gliding SCFE Screw System, GIROTM Growth Modulation System, PNP Tibia System, ApiFix Mid-C System, and Mitchell Ponseti. The company serves pediatric orthopedic market, as well as pediatric orthopedic surgeons and caregivers. OrthoPediatrics Corp. was founded in 2006 and is headquartered in Warsaw, Indiana.

About Nihon Kohden

Nihon Kohden Corporation engages in development, manufacturing, sale, maintenance, and consultation of medical electronic equipment, and related systems and products in Japan, Americas, Europe, rest of Asia, and internationally. It offers physiological measuring equipment comprising electrocardiographs, electroencephalographs, and polygraphs for Cath-labs; patient monitoring systems, such as beside and central monitors; and treatment equipment including defibrillators, automated external defibrillators, ventilators, and pacemakers. The company also provides medical support system, which includes diagnostic and clinical information system; and in-vitro diagnostic equipment comprising hematology and clinical chemistry analyzers. In addition, it operates insurance brokerage and technology licensing business. The company was incorporated in 1951 and is headquartered in Shinjuku, Japan.