Lantheus Holdings (NASDAQ: LNTH) and Natera (NASDAQ:NTRA) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their profitabiliy, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Risk and Volatility

Lantheus Holdings has a beta of 0.91, meaning that its stock price is 9% less volatile than the S&P 500. Comparatively, Natera has a beta of 2.46, meaning that its stock price is 146% more volatile than the S&P 500.

Profitability

This table compares Lantheus Holdings and Natera’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lantheus Holdings 8.44% -37.47% 15.16%
Natera -60.89% -101.63% -55.28%

Valuation and Earnings

This table compares Lantheus Holdings and Natera’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Lantheus Holdings $317.61 million 2.02 $75.23 million $0.72 23.89
Natera $202.07 million 2.17 -$114.96 million ($2.38) -3.48

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

Analyst Recommendations

This is a breakdown of current ratings and target prices for Lantheus Holdings and Natera, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lantheus Holdings 0 1 3 0 2.75
Natera 0 0 3 0 3.00

Lantheus Holdings currently has a consensus target price of $18.75, indicating a potential upside of 9.01%. Natera has a consensus target price of $16.67, indicating a potential upside of 101.05%. Given Natera’s stronger consensus rating and higher possible upside, analysts plainly believe Natera is more favorable than Lantheus Holdings.

Institutional & Insider Ownership

65.9% of Lantheus Holdings shares are held by institutional investors. Comparatively, 59.5% of Natera shares are held by institutional investors. 2.3% of Lantheus Holdings shares are held by insiders. Comparatively, 18.9% of Natera shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Lantheus Holdings beats Natera on 7 of the 12 factors compared between the two stocks.

Lantheus Holdings Company Profile

Lantheus Holdings, Inc. is engaged in the development, manufacture and commercialization of diagnostic medical imaging agents and products that assist clinicians in the diagnosis and treatment of cardiovascular and other diseases. Its imaging agents and products are used across a range of imaging modalities, including echocardiography and nuclear imaging. It operates in two segments: U.S. Segment and International Segment. The U.S. Segment produces and markets its medical imaging agents and products throughout the United States. In the United States, it sells its products to radiopharmacies, integrated delivery networks, hospitals, clinics and group practices. The International Segment operations consist of production and distribution activities in Puerto Rico and direct distribution activities in Canada. Its portfolio of nine commercial products is diversified across a range of imaging modalities. Its products include an ultrasound contrast agent and medical radiopharmaceuticals.

Natera Company Profile

Natera, Inc. is a diagnostics company. The Company is engaged in the discovery, development and commercialization of genetic testing services. It offers Panorama Non-Invasive Prenatal Test that screens for chromosomal abnormalities of a fetus with a blood draw from the mother; Horizon Carrier Screening to determine carrier status for a large number of severe genetic diseases that could be passed on to the carrier’s children; Spectrum Pre-implantation Genetic Screening and Spectrum Pre-implantation Genetic Diagnosis to analyze chromosomal anomalies or inherited genetic conditions during an in vitro fertilization cycle to select embryos with the probability of becoming healthy children; Anora Products of Conception test to analyze fetal chromosomes to understand the cause of miscarriage, and Non-Invasive Paternity Testing, to determine paternity by analyzing the fragments of fetal deoxyribonucleic acid in a pregnant mother’s blood and a blood sample from the alleged father(s).

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