Analyzing Omnicell (NASDAQ:OMCL) and American Well (NYSE:AMWL)

American Well (NYSE:AMWL) and Omnicell (NASDAQ:OMCL) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, dividends, earnings and risk.

Profitability

This table compares American Well and Omnicell’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Well	-38.38%	-35.33%	-26.43%
Omnicell	0.17%	3.00%	1.81%

Risk and Volatility

American Well has a beta of 1.39, suggesting that its share price is 39% more volatile than the S&P 500. Comparatively, Omnicell has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500.

Institutional and Insider Ownership

56.0% of American Well shares are held by institutional investors. Comparatively, 97.7% of Omnicell shares are held by institutional investors. 12.8% of American Well shares are held by company insiders. Comparatively, 2.5% of Omnicell shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for American Well and Omnicell, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Well	1	6	1	0	2.00
Omnicell	1	1	6	0	2.63

American Well currently has a consensus target price of $7.42, indicating a potential upside of 29.32%. Omnicell has a consensus target price of $58.50, indicating a potential upside of 63.16%. Given Omnicell’s stronger consensus rating and higher probable upside, analysts clearly believe Omnicell is more favorable than American Well.

Earnings & Valuation

This table compares American Well and Omnicell”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Well	$249.33 million	0.38	-$95.70 million	($5.95)	-0.96
Omnicell	$1.18 billion	1.38	$2.05 million	$0.04	896.38

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

Summary

Omnicell beats American Well on 12 of the 14 factors compared between the two stocks.

About American Well

American Well Corporation, an enterprise platform and software company, delivers digitally enabling hybrid care in the United States and internationally. The company offers Converge, a cloud-based platform that enables health providers, payers, and innovators to provide in-person, virtual and automated care; and delivers virtual primary care, post-discharge follow-up, chronic condition management, virtual nursing, e-sitting, on-demand and scheduled virtual visits, specialty consults, automated care, and behavioral health, as well as specialty care programs, including dermatology, musculoskeletal care, second opinion, and cardiometabolic care to patients and members. It provides Carepoint devices comprising carts, peripherals, tablets, and TVs, which serve as digital access points in clinical settings. In addition, the company offers Amwell Medical Group network services consisting of primary and urgent care, behavioral health therapy, acute psychiatry, lactation counseling, and nutrition services. Further, it provides professional services to facilitate implementation, workflow design, systems integration, and service expansion for its products, as well as patient and provider engagement services. The company sells its products through field sales professionals, channel partners, and value-added resellers. American Well Corporation was incorporated in 2006 and is headquartered in Boston, Massachusetts.

About Omnicell

Omnicell, Inc., together with its subsidiaries, provides medication management solutions and adherence tools for healthcare systems and pharmacies the United States and internationally. The company offers point of care automation solutions to improve clinician workflows in patient care areas of the healthcare system; XT Series automated dispensing systems for medications and supplies used in nursing units and other clinical areas of the hospital, as well as specialized automated dispensing systems for operating room; and robotic dispensing systems for handling the stocking and retrieval of boxed medications. It also provides central pharmacy automation solutions; IV compounding robots; and inventory management software. In addition, the company provides single-dose automation solutions that fill and label a variety of patient-specific, single-dose medication blister packaging based on incoming prescriptions; fully automated and semi-automated filling equipment for institutional pharmacies to warrant automated packaging of medications; and medication blister card packaging and packaging supplies to enhance medication adherence in non-acute care settings. Further, it offers EnlivenHealth Patient Engagement, a web-based solutions. The company was formerly known as Omnicell Technologies, Inc. and changed its name to Omnicell, Inc. in 2001. Omnicell, Inc. was incorporated in 1992 and is headquartered in Fort Worth, Texas.