Contrasting Montrose Environmental Group (NYSE:MEG) and TOMI Environmental Solutions (NASDAQ:TOMZ)

Montrose Environmental Group (NYSE:MEG) and TOMI Environmental Solutions (NASDAQ:TOMZ) are both small-cap business services companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, institutional ownership, earnings and dividends.

Profitability

This table compares Montrose Environmental Group and TOMI Environmental Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Montrose Environmental Group	-5.10%	0.46%	0.21%
TOMI Environmental Solutions	-77.33%	-56.46%	-24.97%

Earnings and Valuation

This table compares Montrose Environmental Group and TOMI Environmental Solutions”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Montrose Environmental Group	$696.40 million	1.52	-$62.31 million	($1.51)	-19.88
TOMI Environmental Solutions	$6.22 million	2.74	-$4.48 million	($0.23)	-3.70

TOMI Environmental Solutions has lower revenue, but higher earnings than Montrose Environmental Group. Montrose Environmental Group is trading at a lower price-to-earnings ratio than TOMI Environmental Solutions, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Montrose Environmental Group has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500. Comparatively, TOMI Environmental Solutions has a beta of 1.1, suggesting that its stock price is 10% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Montrose Environmental Group and TOMI Environmental Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Montrose Environmental Group	0	2	3	0	2.60
TOMI Environmental Solutions	1	0	1	0	2.00

Montrose Environmental Group presently has a consensus price target of $32.00, suggesting a potential upside of 6.58%. TOMI Environmental Solutions has a consensus price target of $3.50, suggesting a potential upside of 311.76%. Given TOMI Environmental Solutions’ higher probable upside, analysts plainly believe TOMI Environmental Solutions is more favorable than Montrose Environmental Group.

Institutional and Insider Ownership

87.9% of Montrose Environmental Group shares are held by institutional investors. Comparatively, 4.8% of TOMI Environmental Solutions shares are held by institutional investors. 11.9% of Montrose Environmental Group shares are held by insiders. Comparatively, 23.9% of TOMI Environmental Solutions shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Montrose Environmental Group beats TOMI Environmental Solutions on 8 of the 14 factors compared between the two stocks.

About Montrose Environmental Group

Montrose Environmental Group, Inc. operates as an environmental services company in the United States, Canada, and internationally. The company operates in three segments: Assessment, Permitting and Response; Measurement and Analysis; and Remediation and Reuse. The Assessment, Permitting and Response segment provides scientific advisory and consulting services to support environmental assessments; environmental emergency response and recovery; toxicology consulting and environmental audits and permits for current operations; facility upgrades; new projects; decommissioning projects; and development projects. This segment also offers technical advisory and consulting services, including regulatory compliance support and planning, environmental, ecosystem and toxicological assessments, and support during responses to environmental disruptions. The Measurement and Analysis segment tests and analyzes air, water, and soil to determine concentrations of contaminants, as well as the toxicological impact of contaminants on flora, fauna, and human health. Its services include source and ambient air testing and monitoring, leak detection, and advanced analytical laboratory services, such as storm water, wastewater, and drinking water analysis. The Remediation and Reuse segment provides engineering, design, implementation, and operations and maintenance services primarily to treat contaminated water, remove contaminants from soil, or create biogas from waste. The company serves financial, oil and gas, utilities, construction, automotive, real-estate, midstream energy, manufacturing, commodities, petrochemical, food and beverage, telecommunications, and engineering industries, as well as local, state, provincial, and federal government entities. Montrose Environmental Group, Inc. was founded in 2012 and is headquartered in North Little Rock, Arkansas.

About TOMI Environmental Solutions

TOMI Environmental Solutions, Inc., a bacteria decontamination and infectious disease control company, engages in the provision of environmental solutions for indoor air and surface disinfection and decontamination in the United States and internationally. The company’s disinfection solutions include SteraPak portable disinfection systems, SteraMist select surface units, SteraMist environment systems, SteraMist total disinfection carts, SteraMist transport units, NV+ fogging disinfection and decontamination systems, SteraMist custom engineered systems, SteraMist Hybrid disinfection systems, SteraMist integrated systems, Stainless Steel 90-Degree applicators, SteraMist plasma decontamination chambers, and iHP Corporate Service Decontamination, which provides full room, equipment, facility, and emergency disinfection and decontamination services. It also manufactures, sells, services, and licenses SteraMist Binary Ionization Technology, a hydrogen peroxide-based mist and fog. The company’s products and services are used in hospitals and medical facilities, bio-safety labs, pharmaceutical facilities, meat and produce processing facilities, universities and research facilities, vivarium labs, and other service industries, including cruise ships, office buildings, hotel and motel rooms, schools, restaurants, military barracks, police and fire departments, prisons, and athletic facilities; and single-family homes and multi-unit residences. TOMI Environmental Solutions, Inc. was incorporated in 1979 and is headquartered in Frederick, Maryland.