Financial Review: Novocure (NASDAQ:NVCR) versus Spectral Medical (NASDAQ:EDTXF)

Novocure (NASDAQ:NVCR) and Spectral Medical (OTCMKTS:EDTXF) are both medical companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, earnings, risk, dividends, analyst recommendations, institutional ownership and valuation.

Institutional and Insider Ownership

65.3% of Novocure shares are held by institutional investors. 5.6% of Novocure shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Novocure and Spectral Medical’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Novocure -20.42% -47.23% -16.47%
Spectral Medical -87.17% -45.91% -40.50%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Novocure and Spectral Medical, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Novocure 0 3 4 0 2.57
Spectral Medical 0 0 0 0 N/A

Novocure presently has a consensus target price of $52.71, suggesting a potential downside of 24.03%. Given Novocure’s higher possible upside, research analysts plainly believe Novocure is more favorable than Spectral Medical.

Valuation and Earnings

This table compares Novocure and Spectral Medical’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Novocure $248.07 million 26.79 -$63.56 million ($0.69) -100.57
Spectral Medical $2.96 million 21.58 -$1.92 million N/A N/A

Spectral Medical has lower revenue, but higher earnings than Novocure.

Volatility and Risk

Novocure has a beta of 2.44, suggesting that its share price is 144% more volatile than the S&P 500. Comparatively, Spectral Medical has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500.

Summary

Novocure beats Spectral Medical on 9 of the 11 factors compared between the two stocks.

Novocure Company Profile

Novocure Ltd. is global oncology company, which engages in the development and commercialization of its innovative therapy. It focuses on the commercial adoption of Optune, and its Tumor Treating Fields delivery system, for the treatment of glioblastoma (GBM), and to advance programs testing the efficacy and safety of Optune in multiple solid tumor indications through clinical pipeline. The company was founded by Yoram Palti in 2000 and is headquartered in St. Helier, Jersey.

Spectral Medical Company Profile

Spectral Medical Inc. focuses on the development and commercialization of treatment for septic shock in North America. The company markets Endotoxin Activity Assay, a rapid diagnostic test for the detection of components of gram negative bacterial cell wall in Europe and Canada; and Toraymyxin, a therapeutic hemoperfusion device that removes endotoxin from the bloodstream in Europe, Canada, and Japan. It also develops, produces, and markets recombinant proteins, antibodies, and calibrators for use in the research and development, as well as products that are manufactured by other diagnostic companies; and develops continuous renal replacement therapy, an open platform for other hemoperfusion cartridges. The company was formerly known as Spectral Diagnostics Inc. and changed its name to Spectral Medical Inc. in December 2014. Spectral Medical Inc. was founded in 1991 and is headquartered in Toronto, Canada.

Receive News & Ratings for Novocure Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Novocure and related companies with MarketBeat.com's FREE daily email newsletter.