Intersect ENT (NASDAQ: XENT) and Meridian Bioscience (NASDAQ:VIVO) are both small-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Valuation & Earnings

This table compares Intersect ENT and Meridian Bioscience’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Intersect ENT $78.71 million 10.78 -$25.22 million ($0.63) -45.71
Meridian Bioscience $200.77 million 3.11 $21.55 million $0.51 29.02

Meridian Bioscience has higher revenue and earnings than Intersect ENT. Intersect ENT is trading at a lower price-to-earnings ratio than Meridian Bioscience, indicating that it is currently the more affordable of the two stocks.

Dividends

Meridian Bioscience pays an annual dividend of $0.50 per share and has a dividend yield of 3.4%. Intersect ENT does not pay a dividend. Meridian Bioscience pays out 98.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Recommendations

This is a summary of current ratings and target prices for Intersect ENT and Meridian Bioscience, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intersect ENT 0 2 7 0 2.78
Meridian Bioscience 1 3 0 0 1.75

Intersect ENT presently has a consensus target price of $30.57, indicating a potential upside of 6.15%. Meridian Bioscience has a consensus target price of $11.50, indicating a potential downside of 22.30%. Given Intersect ENT’s stronger consensus rating and higher probable upside, research analysts clearly believe Intersect ENT is more favorable than Meridian Bioscience.

Insider & Institutional Ownership

86.3% of Intersect ENT shares are held by institutional investors. Comparatively, 87.0% of Meridian Bioscience shares are held by institutional investors. 13.7% of Intersect ENT shares are held by insiders. Comparatively, 2.3% of Meridian Bioscience shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Intersect ENT has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500. Comparatively, Meridian Bioscience has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Profitability

This table compares Intersect ENT and Meridian Bioscience’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intersect ENT -19.81% -15.96% -14.16%
Meridian Bioscience 10.74% 17.03% 11.51%

Summary

Meridian Bioscience beats Intersect ENT on 9 of the 15 factors compared between the two stocks.

Intersect ENT Company Profile

Intersect ENT, Inc. is a commercial-stage drug-device company. The Company develops drugs for patients with ear, nose and throat (ENT) conditions. The Company has developed a drug releasing bioabsorbable implant technology that enables targeted and sustained release of therapeutic agents. This targeted drug delivery technology is designed to allow ENT physicians to manage patient care. The Company’s commercial products are the PROPEL and PROPEL mini drug-releasing implants for patients undergoing sinus surgery to treat chronic sinusitis. The Company is building a portfolio of products based on its drug releasing bio-absorbable implant technology that are designed to provide localized drug delivery to treat patients across the continuum of care in chronic sinusitis. The Company markets PROPEL, which is indicated for use following ethmoid sinus surgery, and PROPEL Mini, which is indicated for use following ethmoid and/or frontal sinus surgery.

Meridian Bioscience Company Profile

Meridian Bioscience, Inc. is a life science company engaged in the development, manufacture, sale and distribution of diagnostic test kits for gastrointestinal, viral, respiratory and parasitic infectious diseases, and elevated blood lead levels, and the manufacture and distribution of bulk antigens, antibodies, polymerase chain reaction (PCR)/quantitative PCR (qPCR) reagents, nucleotides, competent cells and bioresearch reagents used by researchers and other diagnostic manufacturers. Its segments include Diagnostics and Life Science. The Diagnostics segment includes manufacturing operations in Cincinnati, and the sale and distribution of diagnostic test kits in the countries consisting of North, Central and South America; Europe, the Middle East and Africa (EMEA), and other countries outside of the Americas and EMEA. The Life Science segment consists of manufacturing operations in Memphis, Tennessee; Boca Raton, Florida; London, England; Luckenwalde, Germany, and Sydney, Australia.

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