Critical Contrast: Precision Optics (NASDAQ:POCI) and Nuwellis (NASDAQ:NUWE)

Precision Optics (NASDAQ:POCI) and Nuwellis (NASDAQ:NUWE) are both small-cap medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, earnings, risk, valuation, profitability and analyst recommendations.

Valuation & Earnings

This table compares Precision Optics and Nuwellis’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Precision Optics	$19.41 million	2.07	-$140,000.00	($0.28)	-23.61
Nuwellis	$8.86 million	0.50	-$20.21 million	($8.30)	-0.03

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

Risk & Volatility

Precision Optics has a beta of 0.1, suggesting that its stock price is 90% less volatile than the S&P 500. Comparatively, Nuwellis has a beta of 0.31, suggesting that its stock price is 69% less volatile than the S&P 500.

Insider & Institutional Ownership

13.7% of Precision Optics shares are owned by institutional investors. Comparatively, 3.1% of Nuwellis shares are owned by institutional investors. 16.3% of Precision Optics shares are owned by company insiders. Comparatively, 2.6% of Nuwellis shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Precision Optics and Nuwellis’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Precision Optics	-8.43%	-19.07%	-11.81%
Nuwellis	-202.97%	-316.90%	-166.33%

Analyst Recommendations

This is a breakdown of current ratings for Precision Optics and Nuwellis, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Precision Optics	0	0	0	0	N/A
Nuwellis	0	1	0	0	2.00

Summary

Precision Optics beats Nuwellis on 9 of the 11 factors compared between the two stocks.

About Precision Optics

Precision Optics Corporation, Inc. designs, develops, manufactures, and sells specialized optical and illumination systems and related components primarily in the United States and the European Economic Area. It offers medical instrumentation products, including endoscopes and endocouplers, as well as other custom imaging and illumination products, such as Microprecision lenses and micro medical cameras, and 3D endoscopes for use in minimally invasive surgical procedures by hospitals and physicians. The company also provides components and assemblies for industrial and military use. It markets its products to medical device companies. The company was incorporated in 1982 and is based in Gardner, Massachusetts.

About Nuwellis

Nuwellis, Inc., a medical device company, focuses on developing, manufacturing, and commercializing medical devices used in ultrafiltration therapy. The company's products are the Aquadex FlexFlow and Aquadex SmartFlow systems, which are indicated for the treatment of patients suffering from fluid overload who have failed diuretics. Its Aquadex FlexFlow system includes a console, disposable blood circuit set, and disposable catheter. The company sells its products to hospitals and clinics through its direct salesforce in the United States; and through independent specialty distributors primarily in Austria, Brazil, Colombia, the Czech Republic, Germany, Greece, Hong Kong, India, Israel, Italy, Panama. Romania, Singapore, Slovakia, Spain, Switzerland, Thailand, the United Arab Emirates, and the United Kingdom. The company was formerly known as CHF Solutions, Inc. and changed its name to Nuwellis, Inc. in April 2021. Nuwellis, Inc. was founded in 1999 and is headquartered in Eden Prairie, Minnesota.