Contrasting Outset Medical (NASDAQ:OM) & Clover Health Investments (NASDAQ:CLOV)

Clover Health Investments (NASDAQ:CLOV) and Outset Medical (NASDAQ:OM) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.

Analyst Ratings

This is a summary of recent ratings for Clover Health Investments and Outset Medical, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clover Health Investments	1	3	1	0	2.00
Outset Medical	1	1	2	1	2.60

Clover Health Investments presently has a consensus price target of $3.23, suggesting a potential upside of 60.07%. Outset Medical has a consensus price target of $10.00, suggesting a potential upside of 183.29%. Given Outset Medical’s stronger consensus rating and higher possible upside, analysts clearly believe Outset Medical is more favorable than Clover Health Investments.

Institutional & Insider Ownership

19.8% of Clover Health Investments shares are owned by institutional investors. 24.1% of Clover Health Investments shares are owned by insiders. Comparatively, 2.4% of Outset Medical shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Clover Health Investments and Outset Medical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clover Health Investments	$1.37 billion	0.76	-$43.01 million	($0.11)	-18.36
Outset Medical	$119.48 million	0.54	-$81.65 million	($6.79)	-0.52

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

Volatility & Risk

Clover Health Investments has a beta of 2.09, indicating that its share price is 109% more volatile than the S&P 500. Comparatively, Outset Medical has a beta of 2.08, indicating that its share price is 108% more volatile than the S&P 500.

Profitability

This table compares Clover Health Investments and Outset Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clover Health Investments	-3.29%	-16.79%	-9.95%
Outset Medical	-68.34%	-55.65%	-28.64%

Summary

Clover Health Investments beats Outset Medical on 10 of the 15 factors compared between the two stocks.

About Clover Health Investments

Clover Health Investments, Corp. provides medicare advantage plans in the United States. It operates through two segments: Insurance and Non-Insurance. It also offers Clover Assistant, a cloud-based software platform, that enables physicians to detect, identify, and manage chronic diseases earlier; and access to data-driven and personalized insights for the patients they treat. Clover Health Investments, Corp. is based in Franklin, Tennessee.

About Outset Medical

Outset Medical, Inc., a medical technology company, engages in the development of a hemodialysis system for hemodialysis in the United States. The company offers Tablo Hemodialysis System, a compact console with integrated water purification, on-demand dialysate production, and software and connectivity capabilities for dialysis care in acute and home settings; and manufactures, supports, and distributes for Tablo console, Tablo cartridge, and other consumables. It also provides Tablo Data Ecosystem, including TabloHub, a customer-facing portal; MyTablo, a patient-facing portal; and TabloDash, an internal data analytics platform. The company was formerly known as Home Dialysis Plus, Ltd. and changed its name to Outset Medical, Inc. in January 2015. Outset Medical, Inc. was incorporated in 2003 and is headquartered in San Jose, California.