Brainsway (NASDAQ:BWAY – Get Free Report) and Orthofix Medical (NASDAQ:OFIX – Get Free Report) are both small-cap healthcare companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, valuation, risk, earnings, dividends, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
30.1% of Brainsway shares are owned by institutional investors. Comparatively, 89.8% of Orthofix Medical shares are owned by institutional investors. 19.0% of Brainsway shares are owned by insiders. Comparatively, 2.7% of Orthofix Medical 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.
Analyst Recommendations
This is a summary of current ratings and target prices for Brainsway and Orthofix Medical, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Brainsway | 0 | 2 | 5 | 0 | 2.71 |
| Orthofix Medical | 1 | 1 | 3 | 0 | 2.40 |
Brainsway currently has a consensus target price of $18.20, indicating a potential upside of 62.36%. Orthofix Medical has a consensus target price of $14.75, indicating a potential upside of 50.82%. Given Brainsway’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Brainsway is more favorable than Orthofix Medical.
Risk and Volatility
Brainsway has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, Orthofix Medical has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500.
Profitability
This table compares Brainsway and Orthofix Medical’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Brainsway | 15.65% | 12.74% | 8.17% |
| Orthofix Medical | -7.41% | -14.05% | -7.17% |
Valuation & Earnings
This table compares Brainsway and Orthofix Medical”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Brainsway | $60.70 million | 7.43 | $7.57 million | $0.44 | 25.48 |
| Orthofix Medical | $822.31 million | 0.48 | -$92.19 million | ($1.54) | -6.35 |
Brainsway has higher earnings, but lower revenue than Orthofix Medical. Orthofix Medical is trading at a lower price-to-earnings ratio than Brainsway, indicating that it is currently the more affordable of the two stocks.
Summary
Brainsway beats Orthofix Medical on 12 of the 14 factors compared between the two stocks.
About Brainsway
BrainsWay Ltd. develops and sells noninvasive neurostimulation treatments for mental health disorders in the United States and internationally. It offers Deep Transcranial Magnetic Stimulation platform technology for the treatment of major depressive disorders, anxious depression, obsessive-compulsive disorders, smoking addiction, bipolar disorders, post traumatic stress disorders, schizophrenia, Alzheimer's disease, autism, chronic pain, multiple sclerosis, post stroke rehabilitation, and Parkinson's diseases. The company serves doctors, hospitals, and medical centers in the field of psychiatry. BrainsWay Ltd. was founded in 2003 and is headquartered in Jerusalem, Israel.
About Orthofix Medical
Orthofix Medical Inc. operates as a spine and orthopedics company in the United States, Italy, Germany, the United Kingdom, France, Brazil, and internationally. It operates through two segments, Global Spine and Global Orthopedics. The Global Spine segment manufactures and distributes bone growth stimulator devices for enhance of bone fusion, including adjunctive and noninvasive treatment of cervical and lumbar spine, as well as a therapeutic treatment for non-spine; designs, develops, and markets a portfolio of motion preservation and fixation implant products, which are used in surgical procedures of the spine; and offers biological products, such as fiber-based and particulate demineralized bone matrices, cellular bone allografts, collagen ceramic matrices, and synthetic bone void fillers, and tissue forms, which allow physicians to treat various spinal and orthopedic conditions. This segment also designs, develops, and markets a portfolio of navigation technologies, including tracked surgical tools, intelligent software, and imaging equipment based on machine-vision and optical innovations. The Global Orthopedics segment offers products and solutions that allow physicians to treat various orthopedic conditions related to limb reconstruction and deformity correction unrelated to the spine. This segment designs, develops, and markets external and internal fixation orthopedic products that are coupled with enabling digital technologies to serve the complete patient treatment pathway. It sells its products through distributors and sales representatives to hospitals, healthcare organizations, and healthcare providers. The company was formerly known as Orthofix International N.V. and changed its name to Orthofix Medical Inc. in 2018. Orthofix Medical Inc. was founded in 1980 and is headquartered in Lewisville, Texas.
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