ArthroCare (NASDAQ: ARTC) and BIOLASE (NASDAQ:BIOL) are both healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, valuation, risk, institutional ownership, dividends and analyst recommendations.
Insider and Institutional Ownership
38.8% of BIOLASE shares are held by institutional investors. 7.1% of BIOLASE shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This is a summary of recent ratings for ArthroCare and BIOLASE, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
BIOLASE has a consensus target price of $2.50, suggesting a potential upside of 399.70%.
Earnings & Valuation
This table compares ArthroCare and BIOLASE’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|BIOLASE||$51.81 million||0.73||-$15.37 million||($0.31)||-1.61|
ArthroCare has higher earnings, but lower revenue than BIOLASE. BIOLASE is trading at a lower price-to-earnings ratio than ArthroCare, indicating that it is currently the more affordable of the two stocks.
This table compares ArthroCare and BIOLASE’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
ArthroCare Corporation (ArthroCare) is a medical device company. ArthroCare develops and manufactures surgical devices, instruments, and implants. Its devices enable surgical procedures and enable new minimally invasive procedures. Many of ArthroCare’s devices use its Coblation technology. This technology dissolves target tissue and limits damage to surrounding healthy tissue. ArthroCare also develops surgical devices utilizing other patented technology, including its OPUS line of fixation products, as well as re-usable surgical instruments. ArthroCare’s two core product consists of sports medicine and ear, nose, and throat (ENT), as well as other areas, such as spine, wound care, urology and gynecology. It’s Sports Medicine, ENT and other products are marketed and sold through two principal geographic distribution channels: Americas (North and South America) and International (all other geographies). In May 2014, Smith & Nephew PLC acquired the Company.
BIOLASE, Inc. (BIOLASE) is a medical device company that develops, manufactures, markets and sells laser systems in dentistry and medicine. The Company markets, sells, and distributes dental imaging equipment, including cone beam digital x-rays and computer-aided design (CAD)/computer-aided manufacturing (CAM) intra-oral scanners, in-office, chair-side milling machines and three-dimensional (3-D) printers. It offers two categories of laser system products: WaterLase (all-tissue) systems and Diode (soft tissue) systems. Its brand, WaterLase, uses a combination of water and laser energy to perform procedures performed using drills, scalpels, and other traditional dental instruments for cutting soft and hard tissue. It also offers its Diode laser systems to perform soft tissue, pain therapy, and cosmetic procedures, including teeth whitening. Its Waterlase and Diode systems use disposable laser tips of differing sizes and shapes depending on the procedures being performed.
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