Brainsway (NASDAQ:BWAY) and Nephros (NASDAQ:NEPH) Head-To-Head Analysis

Nephros (NASDAQ:NEPH) and Brainsway (NASDAQ:BWAY) are both small-cap medical companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Valuation and Earnings

This table compares Nephros and Brainsway”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nephros	$18.79 million	2.10	$1.19 million	$0.07	52.00
Brainsway	$56.22 million	11.40	$7.57 million	$0.35	45.63

Brainsway has higher revenue and earnings than Nephros. Brainsway 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 owned by institutional investors. Comparatively, 30.1% of Brainsway shares are owned by institutional investors. 6.7% of Nephros shares are owned by company insiders. Comparatively, 19.0% of Brainsway shares are owned by company 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.

Analyst Ratings

This is a breakdown of current ratings and price targets for Nephros and Brainsway, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nephros	0	3	1	0	2.25
Brainsway	0	0	5	1	3.17

Nephros presently has a consensus target price of $5.00, indicating a potential upside of 37.36%. Brainsway has a consensus target price of $15.67, indicating a potential downside of 1.90%. Given Nephros’ higher possible upside, analysts clearly believe Nephros is more favorable than Brainsway.

Profitability

This table compares Nephros and Brainsway’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nephros	4.06%	7.66%	5.86%
Brainsway	15.68%	12.28%	7.75%

Volatility & Risk

Nephros has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500. Comparatively, Brainsway has a beta of 1.22, meaning that its stock price is 22% more volatile than the S&P 500.

Summary

Brainsway beats Nephros on 11 of the 15 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 Brainsway

BrainsWay Ltd. develops and sells noninvasive neurostimulation treatments for mental health disorders in the United States and internationally. It offers Deep Transcranial Magnetic Stimulation platform technology for the treatment of major depressive disorders, anxious depression, obsessive-compulsive disorders, smoking addiction, bipolar disorders, post traumatic stress disorders, schizophrenia, Alzheimer's disease, autism, chronic pain, multiple sclerosis, post stroke rehabilitation, and Parkinson's diseases. The company serves doctors, hospitals, and medical centers in the field of psychiatry. BrainsWay Ltd. was founded in 2003 and is headquartered in Jerusalem, Israel.