Investors are weighing the merits of two small-cap medical companies, Pro-Dex (NASDAQ:PDEX) and STAAR Surgical (NASDAQ:STAA), as they evaluate potential investment opportunities in the healthcare sector. The assessment focuses on various factors including valuation, earnings, risk, profitability, and institutional ownership, providing a clearer picture of which company may present a better investment option.
Institutional and Insider Ownership
Institutional investors hold a significant portion of both companies’ shares, with Pro-Dex having **15.3%** of its shares owned by such investors. In stark contrast, **96.7%** of STAAR Surgical’s shares are held by institutional investors. This strong institutional backing for STAAR Surgical suggests a robust belief among large financial managers that the stock is poised for long-term growth.
In terms of insider ownership, **45.9%** of Pro-Dex shares are owned by company insiders, compared to just **0.6%** for STAAR Surgical. High insider ownership can indicate confidence in a company’s future prospects, as insiders often align their financial interests with those of shareholders.
Valuation and Earnings
When comparing financial performance, Pro-Dex and STAAR Surgical exhibit distinct characteristics. Pro-Dex boasts higher earnings but reports lower revenue than STAAR Surgical. Currently, STAAR Surgical is trading at a lower price-to-earnings (P/E) ratio than Pro-Dex, suggesting that it may be a more affordable option for investors at this time.
Pro-Dex’s earnings per share (EPS) demonstrate its ability to generate profit, while STAAR Surgical’s revenue indicates a larger market presence. This divergence raises questions about which metric investors prioritize when assessing potential growth.
Analyst Ratings
Analysts have provided insights into the future potential of both companies. Pro-Dex holds a consensus price target of **$56.00**, indicating a potential upside of **43.15%** from its current trading price. Meanwhile, STAAR Surgical has a consensus target of **$20.68**, suggesting a more modest upside of **8.04%**. The more favorable outlook for Pro-Dex is amplified by its stronger consensus rating, suggesting that analysts view it as a more attractive investment.
Risk and Volatility
Pro-Dex’s stock exhibits a beta of **-0.05**, indicating it is significantly less volatile than the S&P 500. This means its stock price is expected to fluctuate much less compared to broader market movements. In contrast, STAAR Surgical’s beta stands at **1**, aligning its volatility closely with that of the S&P 500. Investors seeking stability may find Pro-Dex’s risk profile more appealing.
Profitability Comparison
A comparative analysis of profitability metrics reveals that Pro-Dex surpasses STAAR Surgical in several key areas. Pro-Dex has demonstrated stronger net margins and return on equity, highlighting its efficiency in generating profit relative to its revenue and shareholder equity.
Company Overviews
Pro-Dex, Inc. was founded in **1978** and is headquartered in **Irvine, California**. The company specializes in designing, developing, and manufacturing powered surgical instruments for medical device manufacturers worldwide. Its product offerings include battery-powered and electric surgical drivers and shavers primarily used in the orthopedic, thoracic, and craniomaxillofacial markets.
On the other hand, STAAR Surgical Company, incorporated in **1982** and based in **Lake Forest, California**, focuses on the design, development, and manufacturing of implantable lenses for eye surgeries. Its products cater to various visual disorders and are marketed to healthcare providers globally.
Conclusion
In summary, Pro-Dex outperforms STAAR Surgical in **10 out of 14** comparative factors, indicating a more favorable position in several investment criteria. Investors should consider their priorities—whether it be growth potential, stability, or insider confidence—when deciding between these two medical companies. As both firms continue to evolve within the healthcare landscape, the investment community will be closely watching their performance and market dynamics.
