Natus Medical (NASDAQ: BABY) and Aradigm (NASDAQ:ARDM) are both small-cap medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.
Volatility & Risk
Natus Medical has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500. Comparatively, Aradigm has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500.
89.5% of Natus Medical shares are owned by institutional investors. Comparatively, 30.3% of Aradigm shares are owned by institutional investors. 5.5% of Natus Medical shares are owned by company insiders. Comparatively, 4.5% of Aradigm shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This is a summary of current recommendations and price targets for Natus Medical and Aradigm, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Natus Medical currently has a consensus target price of $44.00, indicating a potential upside of 22.73%. Aradigm has a consensus target price of $10.00, indicating a potential upside of 536.94%. Given Aradigm’s higher probable upside, analysts clearly believe Aradigm is more favorable than Natus Medical.
Earnings & Valuation
This table compares Natus Medical and Aradigm’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Natus Medical||$500.97 million||2.38||-$20.29 million||$1.45||24.72|
|Aradigm||$14.47 million||1.65||-$10.70 million||($0.72)||-2.18|
Aradigm has lower revenue, but higher earnings than Natus Medical. Aradigm is trading at a lower price-to-earnings ratio than Natus Medical, indicating that it is currently the more affordable of the two stocks.
This table compares Natus Medical and Aradigm’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Natus Medical beats Aradigm on 11 of the 14 factors compared between the two stocks.
About Natus Medical
Natus Medical Incorporated provides newborn care, neurology, and hearing and balance assessment healthcare products and services worldwide. It offers products and services used for the screening, diagnosis, detection, treatment, monitoring, and tracking of common medical ailments in newborn care, hearing impairment, neurological dysfunction, epilepsy, sleep disorders, neuromuscular diseases, and balance and mobility disorders. The company provides computerized neurodiagnostic systems for audiology, neurology, polysomnography, and neonatology; and software systems for managing and tracking disorders and diseases for public health laboratories. It offers diagnostic electroencephalography (EEG), ambulatory EEG, and long term monitoring, intensive care unit monitoring, electromyography, sleep analysis or polysomnography, intra-operative monitoring, and diagnostic and monitoring transcranial doppler ultrasound technology systems. The company also provides hearing screening products to screen the hearing; diagnostic hearing assessment products to screen for or diagnose hearing loss, or to identify abnormalities affecting the peripheral and central auditory nervous systems; balance and mobility systems to diagnose and assist in treating balance disorders; and thermoregulation products to control the incubators and warmers. In addition, it offers jaundice management products to treat jaundice; brain injury products to diagnose the severity of brain injury; NICVIEW, a live streaming video for families with babies in the neonatal intensive care unit (NICU); and essential products used in the everyday operation of NICU. Further, the company provides computer-based audiological, otoneurologic, and vestibular instrumentation and sound rooms to hearing and balance care professionals. It serves hospitals, clinics, laboratories, physicians, nurses, audiologists, and governmental agencies. Natus Medical Incorporated was founded in 1987 and is headquartered in Pleasanton, California.
Aradigm Corporation, a specialty pharmaceutical company, focuses on the development and commercialization of products for the treatment and prevention of severe respiratory diseases. Its lead development candidates are proprietary formulations of the potent antibiotic ciprofloxacin, including Linhaliq and Lipoquin that are delivered by inhalation for the management of infections associated with severe respiratory diseases, including non-cystic fibrosis bronchiectasis, cystic fibrosis, and non-tuberculosis mycobacterium. The company is also developing inhaled ciprofloxacin formulations for treatment of patients with cystic fibrosis, and has tested for the prevention and treatment of inhaled bioterrorism infections, such as Coxiella burnetii or Q fever, inhalation anthrax, tularemia, melioidosis and pneumonic plague. Aradigm Corporation has collaboration agreements with Grifols, S.A. The company was founded in 1991 and is headquartered in Hayward, California.
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