Intersect ENT (XENT) vs. Invuity (IVTY) Critical Analysis

Intersect ENT (NASDAQ: XENT) and Invuity (NASDAQ:IVTY) are both small-cap medical companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, risk, valuation and dividends.

Valuation and Earnings

This table compares Intersect ENT and Invuity’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Intersect ENT $96.30 million 12.47 -$16.36 million ($0.56) -71.16
Invuity $39.62 million 1.85 -$39.91 million ($2.20) -1.39

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

Risk & Volatility

Intersect ENT has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500. Comparatively, Invuity has a beta of -0.05, suggesting that its stock price is 105% less volatile than the S&P 500.

Insider and Institutional Ownership

89.0% of Intersect ENT shares are held by institutional investors. Comparatively, 63.3% of Invuity shares are held by institutional investors. 5.9% of Intersect ENT shares are held by insiders. Comparatively, 8.4% of Invuity shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Intersect ENT and Invuity’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intersect ENT -15.73% -13.67% -12.06%
Invuity -94.51% -543.34% -75.18%

Analyst Ratings

This is a summary of current recommendations and price targets for Intersect ENT and Invuity, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intersect ENT 0 2 7 0 2.78
Invuity 0 0 4 0 3.00

Intersect ENT presently has a consensus price target of $37.57, indicating a potential downside of 5.72%. Invuity has a consensus price target of $7.67, indicating a potential upside of 151.37%. Given Invuity’s stronger consensus rating and higher possible upside, analysts plainly believe Invuity is more favorable than Intersect ENT.

Summary

Intersect ENT beats Invuity on 10 of the 14 factors compared between the two stocks.

Intersect ENT Company Profile

Intersect ENT, Inc., a drug delivery company, researches and develops products for the treatment of patients with ear, nose and throat conditions in the United States. It offers PROPEL and PROPEL mini drug releasing implants for patients undergoing sinus surgery to treat chronic sinusitis; and PROPEL Contour, a steroid releasing implant to frontal and maxillary sinus ostia, or openings, of the dependent sinuses. The company is also developing SINUVA, a steroid releasing implant for refractory disease for the treatment of patients in the physician office setting. The company was formerly known as Sinexus, Inc. and changed its name to Intersect ENT, Inc. in November 2009. Intersect ENT, Inc. was founded in 2003 and is headquartered in Menlo Park, California.

Invuity Company Profile

Invuity, Inc., a medical technology company, develops and markets surgical devices in the United States and Asia. The company through its intelligent photonics technology platform develops single-use and reusable illuminated surgical devices, which provide surgeons with illumination and direct visualization of surgical cavities. It offers various illuminated surgical devices, including Eikon LT illuminated retractor system for breast/oncoplastic/gynecology/EP/plastic/endocrine surgeries; Eiberg illuminated retractor systems for orthopedic surgeries; PhotonBlade, a recision illuminator for breast/plastics/EP/orthopedics surgeries; PhotonSaber Y, a handheld illuminator for orthopedic/spine/cardiothoracic/breast/general/gynecology/plastic surgeries; and PhotonSaber F, a handheld illuminator for spine/orthopedic/neurosurgery surgeries. The company also provides Breiten illuminated retractor systems for spine/orthopedic surgeries; Photonguide XT system, a drop-in intracavity illuminator for spine surgeries; Eika illuminated retractor systems for endocrine/spine/orthopedic surgeries; and PhotonVue, a system used in conjunction with IC Indocyanine for identifying and verifying blood flow in tissue, as well as is used in breast/plastic/colorectal surgeries. It sells its devices through direct sales representatives and independent sales agents; and directly to hospitals and surgeons, as well as to third-party medical device manufacturers. The company was formerly known as Spotlight Surgical, Inc. and changed its name to Invuity, Inc. in 2007. Invuity, Inc. was incorporated in 2004 and is based in San Francisco, California.

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