Head to Head Comparison: Embecta (NASDAQ:EMBC) and Nephros (NASDAQ:NEPH)

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

Risk & Volatility

Nephros has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500. Comparatively, Embecta has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Nephros	-9.40%	-15.64%	-11.43%
Embecta	6.23%	-19.09%	12.27%

Valuation and Earnings

This table compares Nephros and Embecta”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nephros	$14.24 million	1.32	-$1.58 million	($0.14)	-12.79
Embecta	$1.12 billion	0.75	$70.40 million	$1.21	12.01

Embecta has higher revenue and earnings than Nephros. Nephros is trading at a lower price-to-earnings ratio than Embecta, 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, 93.8% of Embecta shares are owned by institutional investors. 4.1% of Nephros shares are owned by company insiders. Comparatively, 0.3% of Embecta shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Nephros and Embecta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nephros	0	0	1	0	3.00
Embecta	1	1	0	0	1.50

Nephros presently has a consensus price target of $5.00, suggesting a potential upside of 179.33%. Embecta has a consensus price target of $12.00, suggesting a potential downside of 17.41%. Given Nephros’ stronger consensus rating and higher probable upside, research analysts clearly believe Nephros is more favorable than Embecta.

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 Embecta

Embecta Corp., a medical device company, focuses on the provision of various solutions to enhance the health and wellbeing of people living with diabetes. Its products include pen needles, syringes, and safety injection devices, as well as digital applications to assist people with managing patient's diabetes. The company primarily sells its products to wholesalers and distributors in the United States and internationally. Embecta Corp. was founded in 1924 and is headquartered in Parsippany, New Jersey.