AVITA Medical (NASDAQ:RCEL) versus GBS (NYSE:GBS) Critical Contrast

GBS (NYSE:GBS) and AVITA Medical (NASDAQ:RCEL) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Earnings & Valuation

This table compares GBS and AVITA Medical”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GBS	$440,000.00	40.61	-$8.31 million	($0.56)	-2.14
AVITA Medical	$64.25 million	3.91	-$61.85 million	($2.39)	-3.97

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

Institutional and Insider Ownership

2.8% of GBS shares are held by institutional investors. Comparatively, 27.7% of AVITA Medical shares are held by institutional investors. 0.3% of GBS shares are held by company insiders. Comparatively, 1.8% of AVITA Medical shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for GBS and AVITA Medical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GBS	0	0	0	0	0.00
AVITA Medical	0	1	3	0	2.75

AVITA Medical has a consensus price target of $17.25, suggesting a potential upside of 81.67%. Given AVITA Medical’s stronger consensus rating and higher probable upside, analysts clearly believe AVITA Medical is more favorable than GBS.

Volatility & Risk

GBS has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, AVITA Medical has a beta of 1.74, suggesting that its stock price is 74% more volatile than the S&P 500.

Profitability

This table compares GBS and AVITA Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GBS	N/A	-85.64%	-54.42%
AVITA Medical	-96.26%	-337.91%	-71.50%

About GBS

GBS Inc. operates as a biosensor diagnostic technology company in the Asia-Pacific and North America. It offers Saliva Glucose Biosensor, an organic thin-film transistor for diabetes management that measures glucose in saliva. The company also focuses on developing SARS-CoV-2 Biosensor, a biosensor test can be used as a complement to the (RNA) virus detection test; and a biosensor platform comprising of biochemistry, immunology, tumor markers, hormones, and nucleic acid diagnostic modalities. GBS Inc. has a research agreement with Johns Hopkins Bloomberg School of Public Health for the development of saliva-based diagnostic tests. The company was formerly known as Glucose Biosensor Systems (Greater China) Holdings, Inc. and changed its name to GBS Inc. in September 2019. The company was incorporated in 2016 and is headquartered in New York, New York. GBS Inc. is a subsidiary of Life Science Biosensor Diagnostics Pty Ltd.

About AVITA Medical

AVITA Medical, Inc., together with its subsidiaries, operates as a regenerative medicine company in the United States and internationally. The company's lead product is the RECELL System, a cell harvesting device used for the treatment of thermal burn wounds, full-thickness skin defects, and repigmentation of stable depigmented vitiligo lesions. It develops RECELL GO to control the manual process of disaggregation, filtration, and soak time. The company was formerly known as AVITA Therapeutics, Inc. AVITA Medical, Inc. was incorporated in 2020 and is headquartered in Valencia, California.