Reviewing Intersect ENT (XENT) and Neuronetics (STIM)

Intersect ENT (NASDAQ:XENT) and Neuronetics (NASDAQ:STIM) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, dividends, earnings and valuation.

Insider & Institutional Ownership

71.3% of Neuronetics shares are held by institutional investors. 5.9% of Intersect ENT shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Intersect ENT and Neuronetics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Intersect ENT $108.47 million 9.65 -$22.92 million ($0.76) -44.71
Neuronetics $52.78 million 5.50 -$24.10 million ($2.69) -5.98

Intersect ENT has higher revenue and earnings than Neuronetics. Intersect ENT is trading at a lower price-to-earnings ratio than Neuronetics, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Intersect ENT and Neuronetics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intersect ENT 0 2 4 0 2.67
Neuronetics 0 0 5 0 3.00

Intersect ENT presently has a consensus price target of $39.00, suggesting a potential upside of 14.77%. Neuronetics has a consensus price target of $32.25, suggesting a potential upside of 100.44%. Given Neuronetics’ stronger consensus rating and higher probable upside, analysts plainly believe Neuronetics is more favorable than Intersect ENT.

Profitability

This table compares Intersect ENT and Neuronetics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intersect ENT -21.13% -19.04% -16.75%
Neuronetics N/A N/A N/A

Summary

Neuronetics beats Intersect ENT on 8 of the 13 factors compared between the two stocks.

About Intersect ENT

Intersect ENT, Inc., a drug delivery company, researches and develops products for the treatment of patients with ear, nose and throat conditions in the United States. It offers PROPEL and PROPEL mini drug releasing implants for patients undergoing sinus surgery to treat chronic sinusitis; and PROPEL Contour, a steroid releasing implant to frontal and maxillary sinus ostia, or openings, of the dependent sinuses. The company is also developing SINUVA, a steroid releasing implant for refractory disease for the treatment of patients in the physician office setting. The company was formerly known as Sinexus, Inc. and changed its name to Intersect ENT, Inc. in November 2009. Intersect ENT, Inc. was founded in 2003 and is headquartered in Menlo Park, California.

About Neuronetics

Neuronetics, Inc., a commercial stage medical technology company, designs, develops, and markets products for patients with psychiatric disorders. It offers NeuroStar Advanced Therapy System, a non-invasive and non-systemic office-based treatment for adult patients with major depressive disorder. The company's NeuroStar Advanced Therapy System uses transcranial magnetic stimulation to create a pulsed MRI-strength magnetic field, which induces electrical currents designed to stimulate specific areas of the brain associated with mood. Neuronetics, Inc. was incorporated in 2003 and is headquartered in Malvern, Pennsylvania.

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