Luminex (NASDAQ: LMNX) and Luna Innovations (NASDAQ:LUNA) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, dividends, valuation and analyst recommendations.

Volatility & Risk

Luminex has a beta of 0.19, indicating that its share price is 81% less volatile than the S&P 500. Comparatively, Luna Innovations has a beta of 1.48, indicating that its share price is 48% more volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Luminex 9.52% 6.01% 5.47%
Luna Innovations 26.68% -1.99% -1.35%

Institutional & Insider Ownership

79.2% of Luminex shares are owned by institutional investors. Comparatively, 12.1% of Luna Innovations shares are owned by institutional investors. 6.9% of Luminex shares are owned by company insiders. Comparatively, 13.0% of Luna Innovations shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Luminex pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. Luna Innovations does not pay a dividend. Luminex pays out 36.4% of its earnings in the form of a dividend.

Earnings & Valuation

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Luminex $270.64 million 3.35 $13.81 million $0.66 31.20
Luna Innovations $59.21 million 1.19 -$2.36 million N/A N/A

Luminex has higher revenue and earnings than Luna Innovations.

Analyst Ratings

This is a summary of current ratings and recommmendations for Luminex and Luna Innovations, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Luminex 1 3 0 0 1.75
Luna Innovations 0 0 1 0 3.00

Luminex presently has a consensus price target of $19.33, indicating a potential downside of 6.10%. Luna Innovations has a consensus price target of $3.00, indicating a potential upside of 20.48%. Given Luna Innovations’ stronger consensus rating and higher possible upside, analysts clearly believe Luna Innovations is more favorable than Luminex.

About Luminex

Luminex Corporation develops, manufactures and sells biological testing technologies with applications throughout the diagnostics, pharmaceutical and life sciences industries. The Company’s products are focused on the molecular diagnostic testing market, which includes human genetics, personalized medicine and infectious disease segments. The Company has a range of instruments using its xMAP technology, which includes its LUMINEX 100/200 systems offer 100-plex testing; the Company’s FLEXMAP 3D system is its high-throughput, 500-plex testing system, and its MAGPIX system provides 50-plex testing using imaging rather than flow cytometry. By using its xMAP technology, the end users are able to generate multiple simultaneous results per sample. The Company primarily serves the diagnostics, pharmaceutical and life sciences industries by marketing products, including its testing equipment and assays, to a range of testing laboratories.

About Luna Innovations

Luna Innovations Incorporated develops, manufactures and markets fiber optic sensing and test, and measurement products. The Company is focused on bringing technology solutions to measure and monitor processes in the aerospace, automotive, energy, composite, telecommunications and defense industries. The Company operates in two business segments: Products and Licensing, and Technology Development. The Products and Licensing segment develops, manufactures and markets its suite of products, including high-speed optical receiver (HSOR), custom optoelectronic subsystems (Optoelectronics), and Terahertz (THz) products, and fiber optic sensing, as well as test and measurement products. The Technology Development segment performs applied research principally in the areas of sensing and instrumentation, advanced materials and health sciences. The Company’s HSOR transmission products are deployed in the Internet communications equipment infrastructure for high-speed bandwidth.

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