Outset Medical (NASDAQ:OM – Get Free Report) and Strata Skin Sciences (NASDAQ:SSKN – Get Free Report) are both small-cap medical companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, valuation, analyst recommendations and institutional ownership.
Risk & Volatility
Outset Medical has a beta of 2.03, suggesting that its share price is 103% more volatile than the S&P 500. Comparatively, Strata Skin Sciences has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500.
Earnings and Valuation
This table compares Outset Medical and Strata Skin Sciences”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Outset Medical | $113.69 million | 0.54 | -$127.98 million | ($13.05) | -0.26 |
| Strata Skin Sciences | $33.56 million | 0.22 | -$10.09 million | ($2.67) | -0.46 |
Strata Skin Sciences has lower revenue, but higher earnings than Outset Medical. Strata Skin Sciences is trading at a lower price-to-earnings ratio than Outset Medical, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
32.4% of Strata Skin Sciences shares are owned by institutional investors. 2.4% of Outset Medical shares are owned by insiders. Comparatively, 40.9% of Strata Skin Sciences shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Outset Medical and Strata Skin Sciences, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Outset Medical | 1 | 1 | 2 | 1 | 2.60 |
| Strata Skin Sciences | 1 | 0 | 1 | 0 | 2.00 |
Outset Medical presently has a consensus target price of $12.67, indicating a potential upside of 276.98%. Strata Skin Sciences has a consensus target price of $6.00, indicating a potential upside of 387.80%. Given Strata Skin Sciences’ higher possible upside, analysts clearly believe Strata Skin Sciences is more favorable than Outset Medical.
Profitability
This table compares Outset Medical and Strata Skin Sciences’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Outset Medical | -73.12% | -71.37% | -30.11% |
| Strata Skin Sciences | -35.64% | -476.73% | -33.49% |
Summary
Outset Medical beats Strata Skin Sciences on 9 of the 15 factors compared between the two stocks.
About Outset Medical
Outset Medical, Inc., a medical technology company, engages in the development of a hemodialysis system for hemodialysis in the United States. The company offers Tablo Hemodialysis System, a compact console with integrated water purification, on-demand dialysate production, and software and connectivity capabilities for dialysis care in acute and home settings; and manufactures, supports, and distributes for Tablo console, Tablo cartridge, and other consumables. It also provides Tablo Data Ecosystem, including TabloHub, a customer-facing portal; MyTablo, a patient-facing portal; and TabloDash, an internal data analytics platform. The company was formerly known as Home Dialysis Plus, Ltd. and changed its name to Outset Medical, Inc. in January 2015. Outset Medical, Inc. was incorporated in 2003 and is headquartered in San Jose, California.
About Strata Skin Sciences
STRATA Skin Sciences, Inc., a medical technology company, develops, commercializes, and markets products for the treatment of dermatologic conditions in the United States, Europe, the Middle East, Asia, Australia, South Africa, and Central and South America. The company operates in two segments, Dermatology Recurring Procedures and Dermatology Procedures Equipment. The company products include XTRAC and Pharos excimer lasers, and VTRAC lamp systems for the treatment systems that are used for the treatment of psoriasis, vitiligo, and other skin conditions. It also offers TheraClear Acne Therapy System for the treatment of mild to moderate inflammatory, comedonal, and pustular acne. The company was formerly known as MELA Sciences, Inc and changed its name to STRATA Skin Sciences, Inc. in January 2016. STRATA Skin Sciences, Inc. was incorporated in 1989 and is based in Horsham, Pennsylvania.
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