Sharps Compliance (SMED) vs. CECO Environmental (CECE) Critical Survey

Sharps Compliance (NASDAQ: SMED) and CECO Environmental (NASDAQ:CECE) are both small-cap industrial products companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, valuation and risk.

Profitability

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This table compares Sharps Compliance and CECO Environmental’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sharps Compliance 0.33% 0.54% 0.39%
CECO Environmental -0.88% 4.81% 2.01%

Volatility & Risk

Sharps Compliance has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500. Comparatively, CECO Environmental has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500.

Earnings and Valuation

This table compares Sharps Compliance and CECO Environmental’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sharps Compliance $38.19 million 1.85 -$1.29 million ($0.04) -110.13
CECO Environmental $345.05 million 0.47 -$3.02 million $0.27 17.19

Sharps Compliance has higher earnings, but lower revenue than CECO Environmental. Sharps Compliance is trading at a lower price-to-earnings ratio than CECO Environmental, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

24.1% of Sharps Compliance shares are held by institutional investors. Comparatively, 66.3% of CECO Environmental shares are held by institutional investors. 20.4% of Sharps Compliance shares are held by insiders. Comparatively, 14.3% of CECO Environmental shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

CECO Environmental pays an annual dividend of $0.15 per share and has a dividend yield of 3.2%. Sharps Compliance does not pay a dividend. CECO Environmental pays out 55.6% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Sharps Compliance and CECO Environmental, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sharps Compliance 0 0 2 0 3.00
CECO Environmental 0 2 1 0 2.33

Sharps Compliance presently has a consensus target price of $7.00, indicating a potential upside of 58.91%. CECO Environmental has a consensus target price of $7.00, indicating a potential upside of 50.86%. Given Sharps Compliance’s stronger consensus rating and higher probable upside, equities analysts plainly believe Sharps Compliance is more favorable than CECO Environmental.

About Sharps Compliance

Sharps Compliance Corp. provides medical, pharmaceutical, and hazardous waste management services in the United States. It offers Sharps Recovery System for the containment, transportation, treatment, and tracking of medical waste and used healthcare materials generated outside the hospital and health care facility settings; TakeAway Medication Recovery System, a solution that facilitates the proper disposal of unused medications; MedSafe, a solution for the safe collection, transportation, and proper disposal of unwanted and expired prescription medications; and ComplianceTRAC, a Web-based compliance and training program. The company also provides Route-Based Pickup Service, a waste management service, which offers medical and hazardous waste pick-up services; TakeAway Recycle System, a solution for the collection and recycling of single-use medical devices from surgical centers and other healthcare facilities; and Universal Waste Shipback Systems, a solution for the collection, transportation, and recycling of light bulbs, batteries, and other mercury containing devices. In addition, it offers other solutions, such as TakeAway Environmental Return System, SharpsTracer, Sharps Secure, Needle Disposal System, Complete Needle Collection and Disposal System, Pitch-It IV Poles, Asset Return System, and Spill Kit and Recovery System, as well as Sharps MWMS, a medical waste management system. The company serves customers in home health care, retail clinics and immunizing pharmacies, pharmaceutical manufacturers, professional offices, assisted living and long-term care facilities, government, consumers, commercial, and agriculture markets, as well as distributors. Sharps Compliance Corp. was founded in 1992 and is based in Houston, Texas.

About CECO Environmental

CECO Environmental Corp. provides critical solutions to the environmental, energy, and fluid handling and filtration industries worldwide. The company operates through three segments: Energy, Environmental, and Fluid Handling and Filtration. The Energy segment offers gas turbine exhaust systems, dampers and diverters, gas and liquid separation and filtration equipment, selective catalytic reduction and selective non-catalytic reduction systems, acoustical components and silencers, secondary separators, and expansion joints for the power and petrochemical industries. The Environmental segment designs and manufactures cyclone systems; scrubbers; regenerative thermal and catalytic oxidizers; dust collectors and baghouses; standard and engineered industrial ducting products; fabric filters and cartridge collectors; ventilation and exhaust systems for emissions and contaminants; and process cooling systems for steel in rolling mills. This segment also provides component parts for industrial air systems; and alternatives to traditional duct components, as well as custom metal engineered fabrication services. The Fluid Handling and Filtration segment designs and manufactures centrifugal pumps for corrosive, abrasive, and high temperature liquids; filter products for air and liquid filtration; precious metal recovery systems; carbonate precipitators; and air movement and exhaust systems for use in the aquarium/aquaculture, plating and metal finishing, food and beverage, chemical/petrochemical, wastewater treatment, desalination, and pharmaceutical markets. The company markets its products and services to natural gas processors, refineries, power generators, boiler manufacturers, and compressor manufacturers; and transmission and distribution, metals and minerals, industrial manufacturing, engineering, and construction companies directly and through sales representatives. CECO Environmental Corp. was founded in 1966 and is headquartered in Dallas, Texas.

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