Nephros (NASDAQ:NEPH – Get Free Report) and TransMedics Group (NASDAQ:TMDX – Get Free Report) are both healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, analyst recommendations, institutional ownership, dividends, valuation and profitability.
Volatility & Risk
Nephros has a beta of 1.55, indicating that its share price is 55% more volatile than the S&P 500. Comparatively, TransMedics Group has a beta of 1.9, indicating that its share price is 90% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of current recommendations for Nephros and TransMedics Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Nephros | 0 | 3 | 1 | 0 | 2.25 |
| TransMedics Group | 1 | 6 | 5 | 0 | 2.33 |
Earnings and Valuation
This table compares Nephros and TransMedics Group”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Nephros | $18.79 million | 2.46 | $1.19 million | $0.16 | 26.57 |
| TransMedics Group | $605.49 million | 5.02 | $190.29 million | $3.89 | 22.59 |
TransMedics Group has higher revenue and earnings than Nephros. TransMedics Group is trading at a lower price-to-earnings ratio than Nephros, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
41.1% of Nephros shares are held by institutional investors. Comparatively, 99.7% of TransMedics Group shares are held by institutional investors. 6.7% of Nephros shares are held by company insiders. Comparatively, 6.9% of TransMedics Group shares are held 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.
Profitability
This table compares Nephros and TransMedics Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Nephros | 8.38% | 10.60% | 8.05% |
| TransMedics Group | 22.69% | 15.88% | 5.95% |
Summary
TransMedics Group beats Nephros on 12 of the 14 factors compared between the two stocks.
About Nephros
Nephros, Inc., a commercial-stage company, develops and sells water solutions to the medical and commercial markets in the United States. It offers ultrafiltration products that are used in dialysis centers for the removal of biological contaminants from water and bicarbonate concentrate; and in hospitals for the prevention of infection from waterborne pathogens, such as legionella and pseudomonas, as well as in military and outdoor recreation, commercial, and other healthcare facilities. The company also manufactures and sells water filters that enhance the taste and odor of water, as well as reduce biofilm, cysts, particulates, and scale build-up in downstream equipment. It markets its products to food service, hospitality, convenience store, and health care markets, as well as medical institutions. The company was incorporated in 1997 and is headquartered in South Orange, New Jersey.
About TransMedics Group
TransMedics Group, Inc., a commercial-stage medical technology company, engages in transforming organ transplant therapy for end-stage organ failure patients in the United States and internationally. The company offers Organ Care System (OCS), a portable organ perfusion, optimization, and monitoring system that utilizes its proprietary and customized technology to replicate near-physiologic conditions for donor organs outside of the human body. Its OCS includes OCS LUNG for the preservation of standard criteria donor lungs for double-lung transplantation; OCS Heart, a technology for preservation of DBD donor hearts deemed unsuitable due to limitations of cold storage and for ex vivo reanimation, functional monitoring, and beating-heart preservation of donation-after-circulatory-death hearts; and OCS Liver for the preservation of DBD and DCD of donor livers. The company also developed national OCS program, a turnkey solution for outsourced organ retrieval; and provides OCS organ management and logistics services, including aviation and ground transportation, and other coordination activity. The company was founded in 1998 and is headquartered in Andover, Massachusetts.
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