Nephros (NASDAQ:NEPH – Get Free Report) and Exagen (NASDAQ:XGN – Get Free Report) are both small-cap medical companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, risk and dividends.
Insider & Institutional Ownership
41.1% of Nephros shares are held by institutional investors. Comparatively, 75.3% of Exagen shares are held by institutional investors. 6.7% of Nephros shares are held by insiders. Comparatively, 12.6% of Exagen shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Nephros and Exagen”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Nephros | $14.16 million | 3.99 | $70,000.00 | $0.13 | 40.92 |
| Exagen | $55.64 million | 2.86 | -$15.11 million | ($0.92) | -7.63 |
Nephros has higher earnings, but lower revenue than Exagen. Exagen is trading at a lower price-to-earnings ratio than Nephros, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Nephros and Exagen, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Nephros | 0 | 1 | 1 | 0 | 2.50 |
| Exagen | 1 | 0 | 8 | 0 | 2.78 |
Nephros presently has a consensus price target of $6.00, indicating a potential upside of 12.78%. Exagen has a consensus price target of $14.17, indicating a potential upside of 101.80%. Given Exagen’s stronger consensus rating and higher probable upside, analysts clearly believe Exagen is more favorable than Nephros.
Risk & Volatility
Nephros has a beta of 1.48, meaning that its stock price is 48% more volatile than the S&P 500. Comparatively, Exagen has a beta of 1.8, meaning that its stock price is 80% more volatile than the S&P 500.
Profitability
This table compares Nephros and Exagen’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Nephros | 8.26% | 15.81% | 12.22% |
| Exagen | -29.94% | -113.48% | -30.28% |
About Nephros
Nephros, Inc., a commercial-stage company, develops and sells water solutions to the medical and commercial markets in the United States. It offers ultrafiltration products that are used in dialysis centers for the removal of biological contaminants from water and bicarbonate concentrate; and in hospitals for the prevention of infection from waterborne pathogens, such as legionella and pseudomonas, as well as in military and outdoor recreation, commercial, and other healthcare facilities. The company also manufactures and sells water filters that enhance the taste and odor of water, as well as reduce biofilm, cysts, particulates, and scale build-up in downstream equipment. It markets its products to food service, hospitality, convenience store, and health care markets, as well as medical institutions. The company was incorporated in 1997 and is headquartered in South Orange, New Jersey.
About Exagen
Exagen Inc. develops and commercializes various testing products under the AVISE brand in the United States. The company enables healthcare providers to care for patients through the diagnosis, prognosis, and monitoring of autoimmune and autoimmune-related diseases, including systemic lupus erythematosus (SLE) and rheumatoid arthritis (RA). Its lead testing product is AVISE CTD that enables differential diagnosis for patients presenting with symptoms indicative of various connective tissue diseases (CTDs) and other related diseases with overlapping symptoms. The company offers AVISE Lupus that measures activation of the complement system by quantifying the level of B-cell C4d and erythrocyte bound C4d in the patient's blood; and AVISE APS, which consists of a panel of autoantibody tests that aids in the diagnosis and management of APS. In addition, it provides AVISE Vasculitis AAV, which utilizes a testing panel of individual analytes to provide physicians with results in the assessment and monitoring of anti-neutrophil cytoplasmic antibody associated vasculitis; AVISE SLE Prognostic, a panel of autoantibodies for assessing the potential for complications affecting the kidney, brain, and cardiovascular system; and AVISE Anti-CarP test, which identifies RA patients with severe disease. Further, the company offers AVISE SLE Monitor, a biomarker blood test; AVISE MTX, a patented and validated blood test; and AVISE HCQ, a blood test to monitor levels of hydroxychloroquine. It has a research collaboration and license agreement with Allegheny Health Network (AHN) Research Institute to develop novel patented biomarkers. The company was formerly known as Exagen Diagnostics, Inc. and changed its name to Exagen Inc. in January 2019. Exagen Inc. was incorporated in 2002 and is headquartered in Vista, California.
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