Contrasting Zynex (ZYXI) and AxoGen (AXGN)

Zynex (OTCMKTS: ZYXI) and AxoGen (NASDAQ:AXGN) are both small-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Valuation and Earnings

This table compares Zynex and AxoGen’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Zynex $13.31 million 11.27 $60,000.00 $0.13 35.15
AxoGen $41.11 million 20.23 -$14.41 million ($0.40) -61.00

Zynex has higher earnings, but lower revenue than AxoGen. AxoGen is trading at a lower price-to-earnings ratio than Zynex, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for Zynex and AxoGen, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zynex 0 1 0 0 2.00
AxoGen 0 0 7 0 3.00

AxoGen has a consensus target price of $29.33, indicating a potential upside of 20.22%. Given AxoGen’s stronger consensus rating and higher probable upside, analysts clearly believe AxoGen is more favorable than Zynex.

Insider and Institutional Ownership

65.9% of AxoGen shares are held by institutional investors. 9.3% of AxoGen shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Zynex and AxoGen’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zynex 24.10% -248.78% 98.51%
AxoGen -24.74% -91.00% -25.48%

Volatility and Risk

Zynex has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, AxoGen has a beta of 0.12, suggesting that its stock price is 88% less volatile than the S&P 500.

Summary

AxoGen beats Zynex on 8 of the 14 factors compared between the two stocks.

Zynex Company Profile

Zynex, Inc. operates through the Electrotherapy and Pain Management Products segment. The Company conducts its business through its subsidiaries and the operating subsidiary is Zynex Medical, Inc. (ZMI). Its other subsidiaries include Zynex Monitoring Solutions, Inc. (ZMS) and Zynex Europe, ApS (ZEU). ZMI designs, manufactures and markets medical devices that treat chronic and acute pain, as well as activate and exercise muscles for rehabilitative purposes with electrical stimulation. ZMS is in the process of developing its blood volume monitoring product for non-invasive cardiac monitoring. ZEU intends to focus on sales and marketing its products within the international marketplace, upon receipt of necessary regulatory approvals. It markets and sells Zynex-manufactured products and distributes private labeled products. Its products include NexWave, NeuroMove, InWave, Electrodes and Batteries. ZMI devices are intended for pain management to reduce reliance on drugs and medications.

AxoGen Company Profile

AxoGen, Inc. provides surgical solutions for peripheral nerve injuries. The company’s surgical nerve repair solutions include Avance Nerve Graft, an off-the-shelf processed human nerve allograft for bridging severed nerves without the comorbidities associated with a second surgical site; AxoGuard Nerve Connector, a porcine submucosa extracellular matrix (ECM) coaptation aid for tensionless repair of severed nerves; and AxoGuard Nerve Protector, a porcine submucosa ECM product that is used to wrap and protect injured peripheral nerves, as well as reinforces the nerve reconstruction while preventing soft tissue attachments. Its solutions also comprise Avive Soft Tissue Membrane, a minimally processed human umbilical cord membrane that is used as a resorbable soft tissue covering to separate tissues and modulate inflammation in the surgical bed. In addition, the company offers AcroVal neurosensory and motor testing system, which consists of AcroGrip for use in hand grip strength measurement; AcroPinch for measuring pinch strength; and Pressure-Specified Sensory Device, a somatosensory evaluation and measurement device. Further, it provides AxoTouch two point discriminator, a tool that is used for measuring the innervation density of surface area of the skin. The company provides its products to hospitals, surgery centers, and military hospitals in the United States, Canada, the United Kingdom and other European countries, and internationally. AxoGen, Inc. is headquartered in Alachua, Florida.

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