Merit Medical Systems (NASDAQ:MMSI – Get Free Report) and NexGel (NASDAQ:NXGL – Get Free Report) are both healthcare companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Merit Medical Systems and NexGel, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Merit Medical Systems | 0 | 3 | 8 | 1 | 2.83 |
| NexGel | 1 | 1 | 0 | 0 | 1.50 |
Merit Medical Systems currently has a consensus price target of $100.00, suggesting a potential upside of 14.69%. NexGel has a consensus price target of $2.00, suggesting a potential upside of 569.79%. Given NexGel’s higher probable upside, analysts clearly believe NexGel is more favorable than Merit Medical Systems.
Risk and Volatility
Insider & Institutional Ownership
99.7% of Merit Medical Systems shares are owned by institutional investors. Comparatively, 2.2% of NexGel shares are owned by institutional investors. 0.7% of Merit Medical Systems shares are owned by company insiders. Comparatively, 19.8% of NexGel shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Merit Medical Systems and NexGel’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Merit Medical Systems | 9.22% | 13.75% | 8.10% |
| NexGel | -51.26% | -121.18% | -41.15% |
Earnings & Valuation
This table compares Merit Medical Systems and NexGel”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Merit Medical Systems | $1.52 billion | 3.43 | $128.49 million | $2.42 | 36.03 |
| NexGel | $11.42 million | 0.25 | -$3.00 million | ($0.71) | -0.42 |
Merit Medical Systems has higher revenue and earnings than NexGel. NexGel is trading at a lower price-to-earnings ratio than Merit Medical Systems, indicating that it is currently the more affordable of the two stocks.
Summary
Merit Medical Systems beats NexGel on 12 of the 15 factors compared between the two stocks.
About Merit Medical Systems
Merit Medical Systems, Inc. designs, develops, manufactures, and markets single-use medical products for interventional, diagnostic, and therapeutic procedures in the United States and internationally. It operates in two segments, Cardiovascular and Endoscopy. The company provides micropuncture kits, angiographic needles, sheaths, guide wires, and safety products; peripheral intervention, including angiography, drainage, delivery systems, and embolotherapy products; spine products, such as vertebral augmentation, radiofrequency ablation, and bone biopsy systems; oncology products; and cardiac intervention products, such as access, angiography, electrophysiology and cardiac rhythm management, fluid management, hemodynamic monitoring, hemostasis, and intervention to treat various heart conditions. It also offers custom procedural solutions that include critical care products, disinfection protection systems, syringes, manifold kits, and trays and packs; coating services for medical tubes and wires; and sensor components for microelectromechanical systems. In addition, the company provides pulmonary products that consist of laser-cut tracheobronchial stents, over-the-wire and direct visualization delivery systems, and dilation balloons to endoscopically dilate structures; gastroenterology products, such as covered esophageal stents, syringe and gauges, and balloon dilators; and kits and accessories for endoscopy and bronchoscopy procedures. It sells its products to hospitals and alternate site-based physicians, technicians, and nurses through direct sales force, distributors, original equipment manufacturer partners, or custom procedure tray manufacturers. The company was incorporated in 1987 and is headquartered in South Jordan, Utah.
About NexGel
NEXGEL, Inc. manufactures high water content, electron beam cross-linked, and aqueous polymer hydrogels and gels. Its products are used for wound care, medical diagnostics, transdermal drug delivery, and cosmetics. The company was formerly known as AquaMed Technologies, Inc. and changed its name to NEXGEL, Inc. in November 2019. The company was incorporated in 2009 and is based in Langhorne, Pennsylvania.
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