RadNet (NASDAQ: RDNT) and NeoGenomics (NASDAQ:NEO) are both small-cap medical companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitabiliy, institutional ownership, valuation, dividends, risk and earnings.
Risk & Volatility
RadNet has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, NeoGenomics has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.
Valuation & Earnings
This table compares RadNet and NeoGenomics’ gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| RadNet | $897.16 million | 0.41 | $111.45 million | $0.17 | 45.59 |
| NeoGenomics | $246.06 million | 2.99 | $27.30 million | ($0.32) | -28.97 |
RadNet has higher revenue and earnings than NeoGenomics. NeoGenomics is trading at a lower price-to-earnings ratio than RadNet, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent ratings and price targets for RadNet and NeoGenomics, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| RadNet | 0 | 2 | 1 | 0 | 2.33 |
| NeoGenomics | 1 | 0 | 4 | 0 | 2.60 |
RadNet currently has a consensus price target of $8.00, indicating a potential upside of 3.23%. NeoGenomics has a consensus price target of $10.75, indicating a potential upside of 15.97%. Given NeoGenomics’ stronger consensus rating and higher probable upside, analysts clearly believe NeoGenomics is more favorable than RadNet.
Profitability
This table compares RadNet and NeoGenomics’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| RadNet | 0.86% | 19.20% | 1.04% |
| NeoGenomics | -2.81% | 6.02% | 3.10% |
Insider & Institutional Ownership
46.3% of RadNet shares are owned by institutional investors. Comparatively, 77.8% of NeoGenomics shares are owned by institutional investors. 9.4% of RadNet shares are owned by company insiders. Comparatively, 12.2% of NeoGenomics shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Summary
NeoGenomics beats RadNet on 9 of the 14 factors compared between the two stocks.
RadNet Company Profile
RadNet, Inc. is a provider of freestanding, fixed-site outpatient diagnostic imaging services in the United States. As of December 31, 2016, the Company operated directly or indirectly through joint ventures, 305 centers located in California, Delaware, Florida, Maryland, New Jersey, New York and Rhode Island. Its centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders. Its services include magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), nuclear medicine, mammography, ultrasound, diagnostic radiology (X-ray), fluoroscopy and other related procedures. As of December 31, 2016, the Company had in operation 257 MRI systems, 157 CT systems, 47 PET or combination PET/CT systems, 48 nuclear medicine systems, 479 X-ray systems, 279 mammography systems, 551 ultrasound systems and 104 fluoroscopy systems.
NeoGenomics Company Profile
NeoGenomics, Inc. is an operator of a network of cancer-focused genetic testing laboratories. The Company operates in Laboratory Testing Segment. This segment delivers testing services to hospitals, pathologists, oncologists, other clinicians and researchers. It has laboratory locations in Ft. Myers and Tampa, Florida; Aliso Viejo, Fresno, Irvine, and West Sacramento, California; Houston, Texas and Nashville, and Tennessee. It offers testing services, which include Cytogenetics, Fluorescence In-Situ Hybridization (FISH), Flow cytometry, Immunohistochemistry (IHC), Molecular testing and Pathology consultation. Its Pharma Services and Clinical Trials group provides testing services in support of its pharmaceutical clients’ oncology programs from discovery to commercialization. It helps its customers develop a biomarker hypothesis by recommending an optimal platform for molecular screening and backing its discovery tools with the informatics to capture meaningful data.
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