Head-To-Head Comparison: Veracyte (VCYT) and Psychemedics (PMD)

Veracyte (NASDAQ:VCYT) and Psychemedics (NASDAQ:PMD) are both small-cap medical companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Profitability

This table compares Veracyte and Psychemedics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Veracyte -33.00% -65.73% -33.89%
Psychemedics 14.24% 26.58% 18.41%

Dividends

Psychemedics pays an annual dividend of $0.72 per share and has a dividend yield of 4.1%. Veracyte does not pay a dividend.

Volatility & Risk

Veracyte has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Psychemedics has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Veracyte and Psychemedics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Veracyte 0 2 2 0 2.50
Psychemedics 0 0 0 0 N/A

Veracyte currently has a consensus target price of $12.10, indicating a potential downside of 8.47%. Given Veracyte’s higher possible upside, analysts plainly believe Veracyte is more favorable than Psychemedics.

Valuation & Earnings

This table compares Veracyte and Psychemedics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Veracyte $71.95 million 7.45 -$31.00 million ($0.91) -14.53
Psychemedics $39.70 million 2.41 $6.12 million N/A N/A

Psychemedics has lower revenue, but higher earnings than Veracyte.

Insider and Institutional Ownership

86.7% of Veracyte shares are owned by institutional investors. Comparatively, 57.4% of Psychemedics shares are owned by institutional investors. 13.7% of Veracyte shares are owned by insiders. Comparatively, 9.9% of Psychemedics 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.

Summary

Psychemedics beats Veracyte on 7 of the 13 factors compared between the two stocks.

Veracyte Company Profile

Veracyte, Inc. operates as a genomic diagnostics company in the United States. The company uses genomic technology to resolve diagnostic uncertainty. It offers Afirma Thyroid FNA Analysis solution; cytopathology testing services; and the Afirma Malignancy Classifiers to manage thyroid nodule patients. The company's products also include Percepta Bronchial Genomic Classifier solution for use in lung cancer screening and diagnosis; and Envisia Genomic Classifier solution for idiopathic pulmonary fibrosis. Veracyte, Inc. sells its products through product specialists, institutional managers, account managers, and medical science specialists. Veracyte, Inc. has research collaboration agreement with Loxo Oncology to develop medicines for patients with genetically defined cancers. The company was formerly known as Calderome, Inc. and changed its name to Veracyte, Inc. in March 2008. Veracyte, Inc. was incorporated in 2006 and is headquartered in South San Francisco, California.

Psychemedics Company Profile

Psychemedics Corporation provides testing services for the detection of drugs of abuse through the analysis of hair samples in the United States and internationally. The company's tests provide quantitative information that can indicate the approximate amount of drug ingested, as well as historical data, which can show a pattern of individual drug use over a longer period of time. It provides screening and confirmation by mass spectrometry using industry-accepted practices for cocaine, marijuana, PCP, amphetamines, synthetic cannabinoids, and benzodiazepines, as well as opiates, including heroin, hydrocodone, hydromorphone, oxycodone, oxymorphone, and codeine. The company offers its services to employers for applicant and employee testing; treatment professionals, law enforcement agencies, school administrators, and parents concerned about their children's drug use; and Fortune 500 companies and small to mid-size corporations, as well as school and government entities. Psychemedics Corporation was founded in 1985 and is headquartered in Acton, Massachusetts.

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