Analyzing Varex Imaging (NASDAQ:VREX) and SiBone (NASDAQ:SIBN)

SiBone (NASDAQ:SIBN) and Varex Imaging (NASDAQ:VREX) are both small-cap healthcare companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, risk, profitability, institutional ownership and earnings.

Analyst Ratings

This is a summary of current ratings for SiBone and Varex Imaging, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SiBone	1	0	6	0	2.71
Varex Imaging	0	7	0	0	2.00

SiBone presently has a consensus price target of $24.17, suggesting a potential upside of 33.24%. Varex Imaging has a consensus price target of $16.88, suggesting a potential downside of 8.86%. Given SiBone’s stronger consensus rating and higher possible upside, research analysts clearly believe SiBone is more favorable than Varex Imaging.

Volatility and Risk

SiBone has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500. Comparatively, Varex Imaging has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500.

Profitability

This table compares SiBone and Varex Imaging’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SiBone	-6.85%	-8.23%	-6.07%
Varex Imaging	2.55%	9.19%	4.13%

Valuation & Earnings

This table compares SiBone and Varex Imaging”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SiBone	$200.93 million	4.00	-$18.90 million	($0.34)	-53.35
Varex Imaging	$844.60 million	0.92	-$70.30 million	$0.52	35.61

SiBone has higher earnings, but lower revenue than Varex Imaging. SiBone is trading at a lower price-to-earnings ratio than Varex Imaging, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

98.1% of SiBone shares are owned by institutional investors. 4.0% of SiBone shares are owned by company insiders. Comparatively, 4.6% of Varex Imaging shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Varex Imaging beats SiBone on 8 of the 14 factors compared between the two stocks.

About SiBone

SI-BONE, Inc., a medical device company, that operate to solve musculoskeletal disorders of the sacropelvic anatomy in the United States and internationally. It offers proprietary minimally invasive surgical implant system to address sacroiliac joint dysfunction and fusion, adult deformity and degeneration, and pelvic trauma; and implantable bone products. The company also provides iFuse-3D, a titanium implant that combines the triangular cross-section of the iFuse implant with the proprietary 3D-printed porous surface and fenestrated design; iFuse-TORQ, a set of 3D-printed threaded implants designed to treat pelvic trauma; and iFuse Bedrock Granite implant provides sacroiliac fusion and sacropelvic fixation as a foundational element for segmental spinal fusion. It markets its products primarily with a direct sales force, as well as through agents and resellers. SI-BONE, Inc. was incorporated in 2008 and is headquartered in Santa Clara, California.

About Varex Imaging

Varex Imaging Corporation designs, manufactures, and sells X-ray imaging components. The company operates through two segments, Medical and Industrial. The Medical segment designs, manufactures, sells, and services X-ray imaging components, comprising X-ray tubes, digital detectors and accessories, ionization chambers, high voltage connectors, image-processing software and workstations, 3D reconstruction software, computer-aided diagnostic software, collimators, automatic exposure control devices, generators, and heat exchangers. This segment's products are used in a range of applications, including CT, mammography, oncology, cardiac, surgery, dental, and other diagnostic radiography uses. The Industrial segment designs, develops, manufactures, sells, and services Linatron X-ray linear accelerators, X-ray tubes, digital detectors, high voltage connectors, and coolers for use in security and inspection applications, such as baggage screening at airports, cargo screening at ports and borders, and nondestructive testing, irradiation, and inspection in various applications. The company sells its products through imaging system original equipment manufacturers, independent service companies, and distributors, as well as directly to end-users. It has operations in North America, South America, Europe, Russia, the Middle East, India, Africa, Asia, and Australia. Varex Imaging Corporation was incorporated in 2016 and is headquartered in Salt Lake City, Utah.