Veracyte (NASDAQ: VCYT) and Affymetrix (NASDAQ:AFFX) are both medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, profitability, valuation and analyst recommendations.

Earnings and Valuation

This table compares Veracyte and Affymetrix’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Veracyte $71.70 million 3.71 -$20.10 million ($0.80) -9.80
Affymetrix N/A N/A N/A N/A N/A

Affymetrix has higher revenue, but lower earnings than Veracyte.

Institutional & Insider Ownership

65.7% of Veracyte shares are owned by institutional investors. 13.4% of Veracyte shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Veracyte and Affymetrix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Veracyte -35.64% -53.58% -29.07%
Affymetrix 4.24% 4.84% 2.97%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Veracyte and Affymetrix, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Veracyte 0 0 5 0 3.00
Affymetrix 0 0 0 0 N/A

Veracyte currently has a consensus price target of $13.00, indicating a potential upside of 65.82%. Given Veracyte’s higher probable upside, research analysts clearly believe Veracyte is more favorable than Affymetrix.

Summary

Veracyte beats Affymetrix on 5 of the 8 factors compared between the two stocks.

About Veracyte

Veracyte, Inc. is a genomic diagnostics company. The Company uses genomic technology to resolve diagnostic ambiguity. It targets diseases in which patients undergo invasive diagnostic procedures. Its products combine genomic technology, clinical science and machine learning. The Company commercializes over three genomic tests, which are transforming the diagnosis of thyroid cancer, lung cancer and idiopathic pulmonary fibrosis. The Company’s commercial solution, the Afirma Thyroid fine needle aspiration (FNA) Analysis, centers on the Afirma Gene Expression Classifier (GEC). The Afirma GEC is offered directly or as part of a solution that also includes cytopathology. The Company operates in the pulmonology diagnostics market. It offers Percepta Bronchial Genomic Classifier, a genomic test to resolve ambiguity in lung cancer diagnosis. It also offers the Envisia Genomic Classifier, which is designed to help in the assessment of patients suspected to have idiopathic pulmonary fibrosis.

About Affymetrix

Affymetrix, Inc. (Affymetrix) is a provider of life science products and molecular diagnostic products that enable parallel analysis of biological systems at the gene, protein and cell level. The Company operates through two business segments: Affymetrix Core and eBioscience. The Affymetrix Core segment focuses on the development, manufacture and commercialization of systems for genetic analysis in the life sciences, agricultural biotechnology (AgBio) and diagnostic industry. The eBioscience segment primarily focuses on the development, manufacture, marketing and distribution of research products in the areas of flow cytometry, immunoassays, microscopic imaging and other protein-based analyses. The Company sells its products to genomic research centers, academic institutions, government and private laboratories, as well as pharmaceutical, diagnostic and biotechnology companies. It maintains sales and distribution operations across the United States, Europe, Latin America and Asia.

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