Head-To-Head Contrast: QuidelOrtho (NASDAQ:QDEL) versus Avita Medical (NASDAQ:RCEL)

Avita Medical (NASDAQ:RCEL) and QuidelOrtho (NASDAQ:QDEL) are both small-cap healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Earnings & Valuation

This table compares Avita Medical and QuidelOrtho”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Avita Medical	$71.61 million	7.40	-$48.59 million	($1.18)	-14.59
QuidelOrtho	$2.73 billion	0.30	-$1.13 billion	($5.41)	-2.22

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

Profitability

This table compares Avita Medical and QuidelOrtho’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Avita Medical	-56.96%	N/A	-78.53%
QuidelOrtho	-14.24%	3.22%	1.03%

Insider and Institutional Ownership

27.7% of Avita Medical shares are owned by institutional investors. Comparatively, 99.0% of QuidelOrtho shares are owned by institutional investors. 2.2% of Avita Medical shares are owned by insiders. Comparatively, 1.1% of QuidelOrtho shares are owned by 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

Avita Medical has a beta of 2.03, meaning that its stock price is 103% more volatile than the S&P 500. Comparatively, QuidelOrtho has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Avita Medical and QuidelOrtho, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avita Medical	1	1	5	0	2.57
QuidelOrtho	2	4	0	0	1.67

Avita Medical currently has a consensus target price of $15.00, indicating a potential downside of 12.85%. QuidelOrtho has a consensus target price of $13.62, indicating a potential upside of 13.60%. Given QuidelOrtho’s higher probable upside, analysts plainly believe QuidelOrtho is more favorable than Avita Medical.

About Avita Medical

AVITA Medical, Inc., together with its subsidiaries, operates as a regenerative medicine company in the United States and internationally. The company's lead product is the RECELL System, a cell harvesting device used for the treatment of thermal burn wounds, full-thickness skin defects, and repigmentation of stable depigmented vitiligo lesions. It develops RECELL GO to control the manual process of disaggregation, filtration, and soak time. The company was formerly known as AVITA Therapeutics, Inc. AVITA Medical, Inc. was incorporated in 2020 and is headquartered in Valencia, California.

About QuidelOrtho

QuidelOrtho Corporation provides diagnostic testing solutions. The company operates through Labs, Transfusion Medicine, Point-of-Care, and Molecular Diagnostics business units. The Labs business unit provides clinical chemistry laboratory instruments and tests that measure target chemicals in bodily fluids for the evaluation of health and the clinical management of patients; immunoassay laboratory instruments and tests, which measure proteins as they act as antigens in the spread of disease, antibodies in the immune response spurred by disease, or markers of proper organ function and health; testing products to detect and monitor disease progression across a spectrum of therapeutic areas; and specialized diagnostic solutions. The Transfusion Medicine business unit offers immunohematology instruments and tests used for blood typing to ensure patient-donor compatibility in blood transfusions; and donor screening instruments and tests used for blood and plasma screening for infectious diseases. The Point-of-Care business unit provides instruments and tests to provide rapid results across a continuum of point-of-care settings. The Molecular Diagnostics business unit offers polymerase chain reaction thermocyclers; amplification systems; and sample-to-result molecular instruments and tests for syndromic infectious disease diagnostics. The company sells its products directly to end users through a direct sales force; and through a network of distributors for professional use in physician offices, hospitals, clinical laboratories, reference laboratories, urgent care clinics, universities, retail clinics, pharmacies, wellness screening centers, blood banks, and donor centers, as well as for individual, non-professional, and over-the-counter use. It operates in North America, Europe, the Middle East, Africa, China, and internationally. The company was incorporated in 1979 and is headquartered in San Diego, California.