Critical Review: CONMED (NYSE:CNMD) & Brainsway (NASDAQ:BWAY)

CONMED (NYSE:CNMD) and Brainsway (NASDAQ:BWAY) are both small-cap healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.

Risk & Volatility

CONMED has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, Brainsway has a beta of 1.25, meaning that its share price is 25% more volatile than the S&P 500.

Institutional & Insider Ownership

30.1% of Brainsway shares are held by institutional investors. 0.3% of CONMED shares are held by insiders. Comparatively, 19.0% of Brainsway shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares CONMED and Brainsway’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CONMED	4.12%	14.31%	6.33%
Brainsway	15.65%	12.74%	8.17%

Analyst Ratings

This is a summary of recent ratings and recommmendations for CONMED and Brainsway, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CONMED	1	7	0	0	1.88
Brainsway	0	2	5	0	2.71

CONMED presently has a consensus target price of $41.40, suggesting a potential downside of 10.89%. Brainsway has a consensus target price of $18.20, suggesting a potential upside of 37.36%. Given Brainsway’s stronger consensus rating and higher probable upside, analysts clearly believe Brainsway is more favorable than CONMED.

Earnings & Valuation

This table compares CONMED and Brainsway”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CONMED	$1.37 billion	1.01	$47.06 million	$1.85	25.11
Brainsway	$52.22 million	10.20	$7.57 million	$0.44	30.11

CONMED has higher revenue and earnings than Brainsway. CONMED 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 CONMED on 10 of the 14 factors compared between the two stocks.

About CONMED

CONMED Corporation, a medical technology company, develops, manufactures, and sells surgical devices and related equipment for surgical procedures worldwide. The company offers orthopedic surgery products, including BioBrace, TruShot with Y-Knot All-In-One Soft Tissue Fixation System, Y-knot All-Suture Anchors, and Agro Knotless Suture Anchors, which provide clinical solutions to orthopedic surgeons for the augmentation and repair of soft tissue injuries, as well as provides supporting products that enable surgeons to perform minimally invasive sports medicine surgeries. It markets orthopedic surgery products under the Hall, CONMED Linvatec, Concept, and Shutt brands. The company also provides battery-powered and autoclavable bone power tool systems for use in orthopedic, arthroscopic, oral/maxillofacial, podiatric, spinal, and cardiothoracic surgeries under Hall surgical brand name. In addition, it offers general surgery products, including clinical insufflation systems under AirSeal brand; smoke removal devices under Buffalo Filter brand; endomechanical products, such as tissue retrieval bags, trocars, suction irrigation devices, graspers, scissors, and dissectors used in minimally invasive surgeries; and electrosurgical solution comprising monopolar and bipolar generators, argon beam coagulation generators, handpieces, smoke management systems and other accessories. Further, the company provides endoscopic technologies, including therapeutic and diagnostic products for use in gastroenterology procedures, and products for the treatment of diseases of the dilatation, hemostasis, biliary, structure management, and infection prevention and patient monitoring, including ECG and EEG electrodes, and cardiac defibrillation pads. It markets its products directly to hospitals, surgery centers, and other healthcare institutions, as well as through medical specialty distributors. CONMED Corporation was incorporated in 1970 and is headquartered in Largo, Florida.

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.