AtriCure (NASDAQ: ATRC) and Alliqua BioMedical (NASDAQ:ALQA) are both small-cap medical companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, earnings, analyst recommendations, risk, profitability, valuation and institutional ownership.

Risk and Volatility

AtriCure has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, Alliqua BioMedical has a beta of 0.97, suggesting that its stock price is 3% less volatile than the S&P 500.

Valuation and Earnings

This table compares AtriCure and Alliqua BioMedical’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AtriCure $166.00 million 4.55 -$19.62 million ($1.01) -21.77
Alliqua BioMedical $19.93 million 1.06 -$16.79 million ($1.23) -0.34

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

Institutional & Insider Ownership

82.1% of AtriCure shares are owned by institutional investors. Comparatively, 21.7% of Alliqua BioMedical shares are owned by institutional investors. 10.0% of AtriCure shares are owned by insiders. Comparatively, 15.8% of Alliqua BioMedical shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares AtriCure and Alliqua BioMedical’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AtriCure -19.56% -19.56% -11.91%
Alliqua BioMedical -185.30% -107.24% -65.83%

Analyst Recommendations

This is a summary of recent recommendations and price targets for AtriCure and Alliqua BioMedical, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AtriCure 0 1 6 0 2.86
Alliqua BioMedical 0 0 3 0 3.00

AtriCure presently has a consensus target price of $24.83, suggesting a potential upside of 12.93%. Alliqua BioMedical has a consensus target price of $1.42, suggesting a potential upside of 237.30%. Given Alliqua BioMedical’s stronger consensus rating and higher possible upside, analysts clearly believe Alliqua BioMedical is more favorable than AtriCure.

Summary

AtriCure beats Alliqua BioMedical on 8 of the 13 factors compared between the two stocks.

AtriCure Company Profile

AtriCure, Inc. is an atrial fibrillation (Afib) solutions company. The Company develops, manufactures, and sells devices designed primarily for the surgical ablation of cardiac tissue and systems designed for the exclusion of the left atrial appendage. It has various product lines for the ablation of cardiac tissue, including its Isolator Synergy Ablation System, for the treatment of persistent and longstanding persistent forms of Afib in patients undergoing certain open concomitant procedures. It has two primary product lines for cardiac tissue ablation, which include Radio Frequency Ablation Devices and cryoICE Cryoablation System, and a product line for left atrial appendage exclusion. The Company also sells Lumitip dissectors and the Estech line of reusable cardiac surgery (valve) instruments. Its cryoICE cryosurgery product line offers various cryoablation devices. Its AtriClip Left Atrial Appendage Exclusion System is designed to occlude the heart’s left atrial appendage (LAA).

Alliqua BioMedical Company Profile

Alliqua BioMedical, Inc. is a provider of advanced wound care solutions. The Company’s businesses include advanced wound care and contract manufacturing. The Company operates through its subsidiaries, such as AquaMed Technologies, Inc. and Choice Therapeutics, Inc. The Company is engaged in developing a suite of advanced wound care solutions that will enable surgeons, clinicians and wound care practitioners to address the challenges in chronic and acute wounds. The Company utilizes hydrogel technology through which hydrogels are manufactured by introducing a hydrophilic polymer into water to create a feed mix. The Company’s commercial wound care portfolio consists of over four product categories, such as Human Biologics; Antimicrobial Protection; Exudate Management and Contract Manufacturing. Human Biologics include BIOVANCE and Extracellular Matrix (ECM). Under Antimicrobial Protection, the Company offers TheraBond 3D Antimicrobial Barrier Systems and SilverSeal.

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