Head-To-Head Analysis: Embecta (NASDAQ:EMBC) vs. Profound Medical (NASDAQ:PROF)

Profound Medical (NASDAQ:PROF) and Embecta (NASDAQ:EMBC) are both small-cap medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Analyst Recommendations

This is a summary of current ratings and price targets for Profound Medical and Embecta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Profound Medical	0	0	3	0	3.00
Embecta	1	1	0	0	1.50

Profound Medical currently has a consensus price target of $13.75, indicating a potential upside of 76.28%. Embecta has a consensus price target of $12.00, indicating a potential downside of 23.13%. Given Profound Medical’s stronger consensus rating and higher probable upside, research analysts clearly believe Profound Medical is more favorable than Embecta.

Volatility and Risk

Profound Medical has a beta of 0.83, suggesting that its share price is 17% less volatile than the S&P 500. Comparatively, Embecta has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.

Profitability

This table compares Profound Medical and Embecta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Profound Medical	-350.14%	-71.28%	-54.70%
Embecta	6.23%	-19.09%	12.27%

Insider & Institutional Ownership

47.9% of Profound Medical shares are owned by institutional investors. Comparatively, 93.8% of Embecta shares are owned by institutional investors. 1.5% of Profound Medical shares are owned by insiders. Comparatively, 0.3% of Embecta shares are owned by 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.

Valuation & Earnings

This table compares Profound Medical and Embecta”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Profound Medical	$7.20 million	26.52	-$28.57 million	($1.29)	-6.05
Embecta	$1.12 billion	0.80	$70.40 million	$1.21	12.90

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

Summary

Embecta beats Profound Medical on 9 of the 14 factors compared between the two stocks.

About Profound Medical

Profound Medical Corp., together with its subsidiaries, operates as a commercial-stage medical device company that develops and markets incision-free therapeutic systems for the image guided ablation of diseased tissue in Canada, Germany, the United States, and Finland. Its lead product TULSA-PRO system combines magnetic resonance imaging(MRI), robotically-driven transurethral sweeping action/thermal ultrasound and closed-loop temperature feedback control to provide precise, flexible, and durable ablation of a surgeon defined region of prostate and protect the urethra and rectum. The company also offers Sonalleve, which combines real-time MRI and thermometry for the treatment of uterine fibroids, adenomyotic tissue, palliative pain treatment of bone metastases, osteoid osteoma, and management of benign tumors. Profound Medical Corp. is headquartered in Mississauga, Canada.

About Embecta

Embecta Corp., a medical device company, focuses on the provision of various solutions to enhance the health and wellbeing of people living with diabetes. Its products include pen needles, syringes, and safety injection devices, as well as digital applications to assist people with managing patient's diabetes. The company primarily sells its products to wholesalers and distributors in the United States and internationally. Embecta Corp. was founded in 1924 and is headquartered in Parsippany, New Jersey.