Accuray (NASDAQ: IDXG) and Interpace Diagnostics Group (NASDAQ:IDXG) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.

Earnings and Valuation

This table compares Accuray and Interpace Diagnostics Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Accuray $404.90 million 0.83 -$23.89 million ($0.28) -13.93
Interpace Diagnostics Group $15.90 million 2.93 -$12.21 million ($0.81) -2.04

Interpace Diagnostics Group has lower revenue, but higher earnings than Accuray. Accuray is trading at a lower price-to-earnings ratio than Interpace Diagnostics Group, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

83.5% of Accuray shares are owned by institutional investors. Comparatively, 12.5% of Interpace Diagnostics Group shares are owned by institutional investors. 3.9% of Accuray shares are owned by insiders. Comparatively, 2.8% of Interpace Diagnostics Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Accuray and Interpace Diagnostics Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Accuray 2 2 3 0 2.14
Interpace Diagnostics Group 0 0 4 0 3.00

Accuray currently has a consensus target price of $6.75, indicating a potential upside of 73.08%. Interpace Diagnostics Group has a consensus target price of $3.19, indicating a potential upside of 93.18%. Given Interpace Diagnostics Group’s stronger consensus rating and higher possible upside, analysts plainly believe Interpace Diagnostics Group is more favorable than Accuray.

Risk and Volatility

Accuray has a beta of 1.76, suggesting that its stock price is 76% more volatile than the S&P 500. Comparatively, Interpace Diagnostics Group has a beta of 2.33, suggesting that its stock price is 133% more volatile than the S&P 500.

Profitability

This table compares Accuray and Interpace Diagnostics Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Accuray -5.90% -43.31% -5.26%
Interpace Diagnostics Group -71.14% -34.58% -25.64%

Summary

Interpace Diagnostics Group beats Accuray on 7 of the 13 factors compared between the two stocks.

About Accuray

Accuray Incorporated designs, develops, and sells radiosurgery and radiation therapy systems for the treatment of tumors in the body. The company offers the CyberKnife System, a robotic stereotactic radiosurgery and stereotactic body radiation therapy system used for the treatment of various types of cancer and tumors in the body. The CyberKnife System automatically tracks, detects, and corrects for tumor and patient movement in real-time during the procedure, as well as enables the delivery of precise, high dose radiation while patients breathe normally. It also offers the TomoTherapy System, which consists of an integrated and versatile radiation therapy system used for the treatment of a range of cancer types. The company markets its products in the United States directly, as well as through a sales agent and group purchasing organizations; and directly and through distributors and sales agents in Europe, Japan and other countries of Asia, South America, and internationally to hospitals and stand-alone treatment facilities. Accuray Incorporated was incorporated in 1990 and is headquartered in Sunnyvale, California.

About Interpace Diagnostics Group

Interpace Diagnostics Group, Inc. develops and commercializes molecular diagnostic tests to detect genetic and other molecular alterations associated with gastrointestinal and endocrine cancers. It offers PancraGEN, a pancreatic cyst and pancreaticobiliary solid lesion molecular test that helps physicians better assess risk of pancreaticobiliary cancers using its proprietary PathFinder platform; ThyGenX, an oncogenic mutation panel that helps identify malignant thyroid nodules; and ThyraMIR, an microRNA gene expression assay that helps to classify risk of cancer in thyroid nodules. The company's customers consist primarily of physicians, hospitals, and clinics. The company was formerly known as PDI, Inc. and changed its name to Interpace Diagnostics Group, Inc. in December 2015. Interpace Diagnostics Group, Inc. was incorporated in 1986 and is headquartered in Parsippany, New Jersey.

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