Financial Analysis: Tactile Systems Technology (NASDAQ:TCMD) vs. Bioventus (NASDAQ:BVS)

Tactile Systems Technology (NASDAQ:TCMD) and Bioventus (NASDAQ:BVS) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, analyst recommendations, dividends, earnings and profitability.

Institutional and Insider Ownership

83.4% of Tactile Systems Technology shares are held by institutional investors. Comparatively, 62.9% of Bioventus shares are held by institutional investors. 2.1% of Tactile Systems Technology shares are held by insiders. Comparatively, 33.5% of Bioventus shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Tactile Systems Technology and Bioventus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tactile Systems Technology	6.68%	10.73%	8.53%
Bioventus	9.78%	26.31%	10.13%

Earnings and Valuation

This table compares Tactile Systems Technology and Bioventus”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tactile Systems Technology	$329.52 million	1.84	$19.09 million	$1.03	26.34
Bioventus	$568.09 million	1.63	$22.73 million	$0.80	13.74

Bioventus has higher revenue and earnings than Tactile Systems Technology. Bioventus is trading at a lower price-to-earnings ratio than Tactile Systems Technology, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Tactile Systems Technology has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500. Comparatively, Bioventus has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for Tactile Systems Technology and Bioventus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tactile Systems Technology	0	2	4	0	2.67
Bioventus	0	1	5	0	2.83

Tactile Systems Technology currently has a consensus price target of $36.80, indicating a potential upside of 35.64%. Bioventus has a consensus price target of $16.60, indicating a potential upside of 51.05%. Given Bioventus’ stronger consensus rating and higher possible upside, analysts plainly believe Bioventus is more favorable than Tactile Systems Technology.

Summary

Bioventus beats Tactile Systems Technology on 9 of the 14 factors compared between the two stocks.

About Tactile Systems Technology

Tactile Systems Technology, Inc. develops and markets medical devices for home-based treatment of chronic conditions. Its products include pneumatic compression systems and garments designed to help manage lymphedema, chronic venous insufficiency and related swelling, as well as airway clearance devices for people with respiratory conditions. The company’s portfolio includes the Flexitouch and Entre systems for compression therapy and the AffloVest, a wearable device that helps loosen and clear airway secretions.

About Bioventus

Bioventus Inc. is a medical technology company focused on helping patients recover from musculoskeletal conditions and injuries. Its products and services support bone healing, pain management and surgical care. The company’s offerings include noninvasive devices that use ultrasound to support bone healing, injectable treatments for osteoarthritis pain, and surgical products such as bone graft materials and ultrasonic instruments used in procedures. Bioventus began operations in 2012, originating from businesses previously owned by Smith & Nephew.