Bioanalytical Systems (NASDAQ:BASI) and Luna Innovations (NASDAQ:LUNA) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Bioanalytical Systems and Luna Innovations, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bioanalytical Systems 0 0 0 0 N/A
Luna Innovations 0 1 2 0 2.67

Luna Innovations has a consensus target price of $4.50, suggesting a potential downside of 9.09%. Given Luna Innovations’ higher probable upside, analysts clearly believe Luna Innovations is more favorable than Bioanalytical Systems.

Profitability

This table compares Bioanalytical Systems and Luna Innovations’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bioanalytical Systems -2.82% -3.12% -1.09%
Luna Innovations 22.56% 5.52% 4.43%

Earnings and Valuation

This table compares Bioanalytical Systems and Luna Innovations’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bioanalytical Systems $26.35 million 0.78 -$190,000.00 N/A N/A
Luna Innovations $42.92 million 3.24 $11.00 million $0.04 123.75

Luna Innovations has higher revenue and earnings than Bioanalytical Systems.

Institutional & Insider Ownership

6.0% of Bioanalytical Systems shares are held by institutional investors. Comparatively, 21.9% of Luna Innovations shares are held by institutional investors. 7.8% of Bioanalytical Systems shares are held by insiders. Comparatively, 11.2% of Luna Innovations shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Bioanalytical Systems has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500. Comparatively, Luna Innovations has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500.

Summary

Luna Innovations beats Bioanalytical Systems on 10 of the 11 factors compared between the two stocks.

About Bioanalytical Systems

Bioanalytical Systems, Inc. provides drug discovery and development services, and analytical instruments for pharmaceutical, biotechnology, academic, and government organizations in the United States, rest of North America, the Pacific Rim, Europe, and internationally. It operates through two segments, Contract Research Services and Research Products. The Contract Research Services segment offers screening and pharmacological testing, nonclinical safety testing, formulation development, regulatory compliance, and quality control testing services. This segment also provides in vivo sampling services for the continuous monitoring of chemical changes in life; non-clinical and pathology services; analytical method development and validation; drug metabolism, bioanalysis, and pharmacokinetics testing to measure drug and metabolite concentrations in complex biological matrices; stability testing to ensure the integrity of various solutions used in nonclinical and clinical studies, and post-study analyses; and climate-controlled archiving services for its customers' data and samples. The Research Products segment offers analytical products comprising liquid chromatographic and electrochemical instruments with associated accessories; in vivo sampling products consisting of Culex family of automated in vivo sampling and dosing instruments; and Vetronics' products, such as instruments and related software to monitor and diagnose cardiac function, and measure other vital physiological parameters in cats and dogs in veterinary clinics. Bioanalytical Systems, Inc. was founded in 1974 and is headquartered in West Lafayette, Indiana.

About Luna Innovations

Luna Innovations Incorporated develops, manufactures, and markets fiber optic sensing, and test and measurement products worldwide. It operates in two segments, Products and Licensing, and Technology Development. The Products and Licensing segment offers fiber optic sensing products, as well as test and measurement products to monitor the integrity of fiber optic network components and sub-assemblies, which include optical vector analyzer, optical backscatter reflectometers, and the Phoenix family of tunable lasers; and distributed sensing systems comprising optical distributed sensor interrogator sensing solution with multiple sensors whose inputs are integrated through a fiber optic network and software. This segment also offers optoelectronic solutions for various applications, such as metrology, missile guidance, flame monitoring, temperature sensing, particle detection, color sensing, infrared detection, and other applications; and terahertz sensing systems, which are used to measure and verify physical properties online and in real-time. In addition, this segment conducts applied research in the fiber optic sensing area for corporate and government customers. The Technology Development segment provides applied research for customers principally in the areas of sensing and instrumentation, advanced materials, and health sciences. The company sells its products to telecommunications companies, defense agencies, government system integrators, researchers, original equipment manufacturers, distributors, testing labs, and strategic partners directly, as well as through manufacturer representative organizations, partner and distribution channels, technical sales engineers, value added resellers, and independent sales representatives. Luna Innovations Incorporated was founded in 1990 and is headquartered in Roanoke, Virginia.

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