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

Analyst Recommendations

This is a breakdown of current recommendations for Alliqua Biomedical and Obalon Therapeutics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alliqua Biomedical 0 1 0 0 2.00
Obalon Therapeutics 0 3 2 0 2.40

Obalon Therapeutics has a consensus price target of $2.35, suggesting a potential upside of 319.64%. Given Obalon Therapeutics’ stronger consensus rating and higher probable upside, analysts clearly believe Obalon Therapeutics is more favorable than Alliqua Biomedical.

Valuation & Earnings

This table compares Alliqua Biomedical and Obalon Therapeutics’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alliqua Biomedical $2.22 million 6.50 -$8.42 million ($6.49) -0.44
Obalon Therapeutics $9.10 million 1.45 -$37.38 million ($1.96) -0.29

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

Institutional & Insider Ownership

13.9% of Alliqua Biomedical shares are held by institutional investors. Comparatively, 28.6% of Obalon Therapeutics shares are held by institutional investors. 13.2% of Alliqua Biomedical shares are held by company insiders. Comparatively, 17.9% of Obalon Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Alliqua Biomedical has a beta of 1.95, indicating that its share price is 95% more volatile than the S&P 500. Comparatively, Obalon Therapeutics has a beta of -0.98, indicating that its share price is 198% less volatile than the S&P 500.

Profitability

This table compares Alliqua Biomedical and Obalon Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alliqua Biomedical N/A -72.84% -41.48%
Obalon Therapeutics -196.40% -96.97% -50.99%

Summary

Obalon Therapeutics beats Alliqua Biomedical on 8 of the 14 factors compared between the two stocks.

Alliqua Biomedical Company Profile

Alliqua BioMedical, Inc., a regenerative technologies company, commercializes regenerative medical products that assist the body in the repair or replacement of soft tissue. The company markets MIST Ultrasound Healing Therapy, a painless noncontact low-frequency ultrasound to promote healing; and Biovance Amniotic Membrane Allograft and Interfyl Human Connective Tissue Matrix, which are human biologic regenerative technologies. It also provides contract manufacturing services, including the development, manufacture, and marketing of high water content, electron beam cross-linked, and aqueous polymer hydrogels or gels used in wound care, medical diagnostics, transdermal drug delivery, and cosmetics. The company is headquartered in Yardley, Pennsylvania.

Obalon Therapeutics Company Profile

Obalon Therapeutics, Inc., a vertically integrated medical device company, focuses on developing and commercializing medical devices to treat obese and overweight people by facilitating weight loss. It offers the Obalon balloon system designed to provide weight loss in obese patients. Obalon Therapeutics, Inc. was founded in 2008 and is headquartered in Carlsbad, California.

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