Analyzing Tenon Medical (NASDAQ:TNON) and Neuronetics (NASDAQ:STIM)

Neuronetics (NASDAQ:STIM) and Tenon Medical (NASDAQ:TNON) are both small-cap medical companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, risk, institutional ownership, dividends and valuation.

Risk and Volatility

Neuronetics has a beta of 2.11, indicating that its share price is 111% more volatile than the S&P 500. Comparatively, Tenon Medical has a beta of 1.9, indicating that its share price is 90% more volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Neuronetics	$72.71 million	0.66	-$30.19 million	($1.23)	-1.28
Tenon Medical	$3.32 million	2.08	-$15.58 million	($27.23)	-0.08

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

Profitability

This table compares Neuronetics and Tenon Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Neuronetics	-50.09%	-141.24%	-32.77%
Tenon Medical	-413.88%	-1,785.88%	-164.26%

Insider & Institutional Ownership

53.6% of Neuronetics shares are owned by institutional investors. Comparatively, 22.7% of Tenon Medical shares are owned by institutional investors. 9.8% of Neuronetics shares are owned by company insiders. Comparatively, 4.7% of Tenon Medical shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for Neuronetics and Tenon Medical, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Neuronetics	0	1	3	0	2.75
Tenon Medical	0	0	2	0	3.00

Neuronetics currently has a consensus price target of $4.67, indicating a potential upside of 197.24%. Tenon Medical has a consensus price target of $5.50, indicating a potential upside of 150.00%. Given Neuronetics’ higher possible upside, equities analysts clearly believe Neuronetics is more favorable than Tenon Medical.

Summary

Neuronetics beats Tenon Medical on 10 of the 14 factors compared between the two stocks.

About Neuronetics

Neuronetics, Inc., a commercial stage medical technology company, designs, develops, and markets products for patients with neurohealth disorders in the United States and internationally. The company offers NeuroStar Advanced Therapy System, a non-invasive and non-systemic office-based treatment to treat adult patients with major depressive disorder. Its NeuroStar Advanced Therapy System uses transcranial magnetic stimulation to create a pulsed, MRI-strength magnetic field that induces electrical currents designed to stimulate specific areas of the brain associated with mood. The company sells its products through its sales and customer support team to psychiatrists. The company was incorporated in 2001 and is headquartered in Malvern, Pennsylvania.

About Tenon Medical

Tenon Medical, Inc., a medical device company, engages in the development of surgical implant systems to treat severe lower back pain in the United States and Puerto Rico. The company offers CATAMARAN SI-Joint Fusion System to fuse sacroiliac joints (SI-Joints) to treat SI-Joint dysfunction that often causes severe lower back pain; and features fixation device that passes through the axial and sagittal planes of the ilium and sacrum, as well as transfixes the SI joints. Tenon Medical, Inc. was incorporated in 2012 and is headquartered in Los Gatos, California.