Financial Survey: NeuroPace (NASDAQ:NPCE) & DexCom (NASDAQ:DXCM)

DexCom (NASDAQ:DXCM) and NeuroPace (NASDAQ:NPCE) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, analyst recommendations, valuation, risk and profitability.

Analyst Recommendations

This is a breakdown of current recommendations for DexCom and NeuroPace, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DexCom	2	4	18	2	2.77
NeuroPace	1	1	6	0	2.63

DexCom presently has a consensus price target of $86.30, suggesting a potential upside of 18.45%. NeuroPace has a consensus price target of $18.50, suggesting a potential upside of 10.71%. Given DexCom’s stronger consensus rating and higher probable upside, analysts plainly believe DexCom is more favorable than NeuroPace.

Profitability

This table compares DexCom and NeuroPace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DexCom	15.96%	30.65%	10.56%
NeuroPace	-25.28%	-136.60%	-22.94%

Valuation and Earnings

This table compares DexCom and NeuroPace”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DexCom	$4.03 billion	7.05	$576.20 million	$1.80	40.48
NeuroPace	$79.91 million	6.97	-$27.14 million	($0.76)	-21.99

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

Institutional & Insider Ownership

97.8% of DexCom shares are held by institutional investors. Comparatively, 78.8% of NeuroPace shares are held by institutional investors. 0.3% of DexCom shares are held by company insiders. Comparatively, 20.5% of NeuroPace shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

DexCom has a beta of 1.48, indicating that its stock price is 48% more volatile than the S&P 500. Comparatively, NeuroPace has a beta of 1.85, indicating that its stock price is 85% more volatile than the S&P 500.

Summary

DexCom beats NeuroPace on 13 of the 15 factors compared between the two stocks.

About DexCom

DexCom, Inc., a medical device company, focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems in the United States and internationally. The company provides its systems for use by people with diabetes, as well as for use by healthcare providers. Its products include Dexcom G6 and Dexcom G7, integrated CGM systems for diabetes management; Dexcom Share, a remote monitoring system; Dexcom Real-Time API, which enables authorized third-party software developers to integrate real-time CGM data into their digital health apps and devices; and Dexcom ONE, that is designed to replace finger stick blood glucose testing for diabetes treatment decisions. It has also submitted FDA review for Dexcom Stelo for people with type 2 diabetes. The company has a collaboration and license agreement with Verily Life Sciences LLC and Verily Ireland Limited to develop blood-based or interstitial glucose monitoring products. It markets its products directly to endocrinologists, physicians, and diabetes educators. The company was incorporated in 1999 and is headquartered in San Diego, California.

About NeuroPace

NeuroPace, Inc. operates as a medical device company in the United States. The company develops RNS system, a brain-responsive neuromodulation system that delivers personalized, real-time treatment at the seizure source for treating medically refractory focal epilepsy. It also records continuous brain activity data and enables clinicians to monitor patients in person and remotely. Its RNS System includes RNS neurostimulator, cortical strip and depth leads, and Patient Remote Monitor, as well as other implantable and non-implantable accessories. The company sells its products to hospital facilities for initial RNS system implant procedures and for replacement procedures. NeuroPace, Inc. was incorporated in 1997 and is headquartered in Mountain View, California.