Head-To-Head Review: Natera (NASDAQ:NTRA) vs. Grail (NASDAQ:GRAL)

Grail (NASDAQ:GRAL) and Natera (NASDAQ:NTRA) are both medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Profitability

This table compares Grail and Natera’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grail	N/A	N/A	N/A
Natera	-14.01%	-26.23%	-14.27%

Analyst Ratings

This is a summary of current recommendations and price targets for Grail and Natera, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grail	0	3	0	0	2.00
Natera	0	0	16	0	3.00

Grail currently has a consensus target price of $16.00, suggesting a potential downside of 29.33%. Natera has a consensus target price of $160.63, suggesting a potential downside of 6.58%. Given Natera’s stronger consensus rating and higher probable upside, analysts plainly believe Natera is more favorable than Grail.

Insider & Institutional Ownership

99.9% of Natera shares are owned by institutional investors. 7.6% of Natera 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.

Earnings and Valuation

This table compares Grail and Natera”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grail	$117.67 million	6.46	N/A	N/A	N/A
Natera	$1.08 billion	20.97	-$434.80 million	($1.76)	-97.69

Grail has higher earnings, but lower revenue than Natera.

Summary

Natera beats Grail on 7 of the 10 factors compared between the two stocks.

About Grail

GRAIL, Inc. is a healthcare company. It engages in the development of a technology for early detection of cancer. The company was founded by Jeffrey T. Huber, William H. Rastetter, and Mostafa Ronaghi on September 11, 2015 and is headquartered in Menlo Park, CA.

About Natera

Natera, Inc., a diagnostics company, develops and commercializes molecular testing services worldwide. Its products include Panorama, a non-invasive prenatal test that screens for chromosomal abnormalities of a fetus, as well as in twin pregnancies; Horizon carrier screening test for individuals and couples determine if they are carriers of genetic variations that cause certain genetic conditions; Vistara single-gene NIPT screens for 25 single-gene disorders that cause severe skeletal, cardiac, and neurological conditions; Spectrum, preimplantation genetic tests for couples undergoing IVF; Anora that analyzes miscarriage tissue from women; Empower, a hereditary cancer screening test; and non-invasive prenatal paternity product, which allows a couple to establish paternity without waiting for the child to be born. The company also provides Signatera, a ctDNA blood test for molecular residual disease assessment and surveillance of disease recurrence in patients previously diagnosed with cancer; Altera, a tissue based comprehensive genomic profiling test; Prospera to assess active rejection in patients who have undergone kidney, heart, and lung transplantation; and Renasight, a kidney gene panel test. In addition, it offers Constellation, a cloud-based software product that enables laboratory customers to gain access through the cloud to the company's algorithms and bioinformatics to validate and launch tests. The company offers products through its direct sales force, as well as through a network of laboratory and distribution partners. It has a partnership agreement with BGI Genomics Co., Ltd. to develop, manufacture, and commercialize NGS-based genetic testing assays; and Foundation Medicine, Inc. to develop and commercialize personalized circulating tumor DNA monitoring assays. The company was founded in 2003 and is headquartered in Austin, Texas.