Financial Analysis: CapsoVision (NASDAQ:CV) versus Shoulder Innovations (NYSE:SI)

Shoulder Innovations (NYSE:SI) and CapsoVision (NASDAQ:CV) are both small-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Profitability

This table compares Shoulder Innovations and CapsoVision’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shoulder Innovations	45.10%	8.87%	0.81%
CapsoVision	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent ratings for Shoulder Innovations and CapsoVision, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shoulder Innovations	0	0	0	0	0.00
CapsoVision	0	0	1	1	3.50

CapsoVision has a consensus price target of $5.50, suggesting a potential upside of 32.85%. Given CapsoVision’s stronger consensus rating and higher probable upside, analysts clearly believe CapsoVision is more favorable than Shoulder Innovations.

Institutional & Insider Ownership

94.4% of Shoulder Innovations shares are owned by institutional investors. 1.7% of Shoulder Innovations shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Shoulder Innovations and CapsoVision”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shoulder Innovations	$34.57 million	12.88	-$937.91 million	($29.96)	-0.47
CapsoVision	N/A	N/A	N/A	N/A	N/A

CapsoVision has lower revenue, but higher earnings than Shoulder Innovations.

Summary

Shoulder Innovations beats CapsoVision on 6 of the 10 factors compared between the two stocks.

About Shoulder Innovations

We are a commercial-stage medical technology company exclusively focused on transforming the shoulder surgical care market. We currently offer advanced implant systems for shoulder arthroplasty. These systems are a core element of our ecosystem, which we designed to improve core components of shoulder surgical care – preoperative planning, implant design and procedural efficiency – to benefit each stakeholder in the care chain. Our ecosystem is also comprised of enabling technologies, efficient instrument systems, specialized support and surgeon-to-surgeon collaboration. Together, these elements seek to address the long-standing clinical and operational challenges in the shoulder surgical care market by delivering predictable outcomes, procedural simplicity, and efficiency across all sites of care. We believe our exclusive focus on shoulder surgical care, combined with a highly specialized commercial organization and strong clinical data, positions us well to capture significant share in this large, growing market. Shoulder pain is highly prevalent, often chronic, and can significantly reduce quality of life. The primary conditions that can result in shoulder pain and reduced functionality include osteoarthritis, rheumatoid arthritis, rotator cuff tears and shoulder fractures. Shoulder conditions are widespread, often debilitating, are commonly experienced concurrently as interrelated musculoskeletal disorders, and are estimated to result in more than eight million physician visits annually in the United States, based on data from the National Ambulatory Medical Care Survey 2015-2016 conducted by the National Center for Health Statistics of the Centers for Disease Control and Prevention (“CDC”). Despite this prevalence, we believe there has been a historical underutilization of surgical treatments for shoulder care due to several factors including patient hesitation to pursue surgical intervention, insufficient technology to appropriately treat shoulder conditions, complex shoulder anatomy, perceived difficulty of surgical intervention and barriers to patient access of care. We believe the shoulder surgical care market today presents a significant market opportunity. Our initial focus within this broader market is on shoulder arthroplasty. Shoulder arthroplasty is an established surgical procedure involving the reconstruction of the shoulder joint with prosthetic implants through one of two main approaches: anatomic total shoulder arthroplasty (“aTSA”) and reverse total shoulder arthroplasty (“rTSA”). Both approaches can be performed in inpatient hospital settings and in outpatient settings, including ambulatory surgery centers (“ASCs”). A key competitive advantage of ours has been the emergence of ASCs as a cost-efficient site of care with positive outcomes relative to hospital-based care. We expect that future growth in the shoulder surgical care market will be significantly driven by ASCs as hospitals face capacity constraints and are more limited in their ability to meet increasing demand. We believe traditional implants used in shoulder arthroplasty procedures are hindered by several limitations, including poor biomechanical fit, suboptimal kinematics, difficult replacement and conversion procedures (aTSA to rTSA or stemless to stem), imprecise implant positioning due to limited surgical planning, inefficient and burdensome workflow designs and non-specialized case support. These limitations can result in continued pain, lack of mobility, postoperative complications, low rates of implant survivorship, necessity of revision surgeries and costly and inefficient procedures for healthcare providers. We developed our ecosystem with an approach to innovation that prioritizes ease of use, flexibility, predictability of outcomes and site of care efficiency, attributes we believe are critical to win in our market. This ecosystem is comprised of our advanced implant systems, ProVoyance preoperative planning technology, efficient instrument system, specialized support and surgeon-to-surgeon collaboration. Our advanced implants are comprised of our aTSA and rTSA systems, which are designed to address the unique needs of patients and surgeons, and include various, specifically designed components capable of a wide array of system configurations to facilitate different modes of operation (anatomic or reverse). Our InSet Glenoid technology serves as the foundation for our advanced implant systems and includes a novel “InSet” design that aims to reduce mechanical stress at the bone implant interface, improve fixation mechanics, enhance stability and reduce micromotion. Our implant systems leverage consistent surgical techniques and the same efficient, two tray instrumentation system. In addition to our advanced implant systems, we offer a leading preoperative surgical planning technology: ProVoyance. We believe that surgeon-level engagement in preoperative planning provides for better care for patients, and that bespoke surgical plans can help facilitate consistent positioning of implants. ProVoyance integrates artificial intelligence (“AI”) and machine learning (“ML”) to transform planar CT imaging into 3D renderings of patient-specific anatomy ahead of surgery, and is cleared by the U.S. Food and Drug Administration (the “FDA”) for preoperative shoulder planning. ProVoyance received 510(k) clearance in 2021 and is classified by the FDA as a Class II device. ProVoyance is listed on the FDA’s AI/ML-enabled medical devices list, which is a resource maintained, published, and periodically updated by the FDA to identify AI/ML-enabled devices that have been authorized for marketing in the United States through any of the standard paths to market for medical devices, although it is not intended to be a comprehensive list of all such devices that incorporate AI/ML. We believe the differentiation and value proposition of ProVoyance is validated by high utilization rates across procedures using our advanced implant systems. For example, for the three months ended June 30, 2025, we estimate an implied utilization rate for our ProVoyance technology of approximately 98%, based on 1,478 surgical plans created using ProVoyance technology and 1,503 implant systems sold during such period. This implied utilization rate is based on real-world data from our customers during such period, as ProVoyance technology tracks and reports each surgical plan that our customers create, and the actual number of implant systems sold during the respective period. A key component of shoulder arthroplasty procedures are instrument trays, equipped with the specific instruments, supplies, and equipment needed for the surgery. We have developed a proprietary two-tray instrument system designed to enable interoperability between our aTSA and rTSA systems and a range of humeral stem options. We believe our efficient, two tray instrument system can enable surgeons and staff to reduce operating room footprint, procedural setup time, sterilization time and expense, and procedural complexity. To best support our surgeon customers, we have built our commercial organization around their unique needs. Our commercial organization is comprised of a dedicated commercial leadership team that drives our internal commercial efforts with an exclusive focus on shoulder care, a Customer Experience and Medical Education (“CEME”) team that enhances surgeon engagement and training and a network of independent distributors. These three key components of our commercial organization work in tandem to form a commercial flywheel that is designed to build and reinforce relationships with surgeons and other stakeholders in the shoulder surgical care market, accelerate adoption, and enhance long-term retention. We leverage our team’s decades of experience developing and launching novel shoulder surgical care technologies to identify the unmet needs of patients and surgeons and develop solutions to address those unmet needs. With respect to our advanced implant systems, we commenced development efforts with our InSet Glenoid in 2009 and received 510(k) clearance in 2011. We commercially launched an initial aTSA system with our InSet Glenoid in 2016. Since this initial launch in 2016, we have successfully launched a wide range of new technologies to enhance our ecosystem and provide surgeons with the tools and support needed to deliver quality outcomes for patients requiring shoulder surgical care. For example, we commenced development efforts for our InSet PLUS Augmented Glenoid in 2019 and received 510(k) clearance in 2020. We commenced development efforts for our rTSA system in 2019 and received 510(k) clearance in 2021. We commenced development efforts for our short stem, stemless and I-Series humeral stem system options for our aTSA and rTSA systems in 2017, 2019 and 2021, respectively, and received our primary 510(k) clearances in 2018 and 2022, with an additional 510(k) clearance in 2024 for use of our primary I-Series humeral stem for use with anatomic fractures. Each of these devices is classified by the FDA as a Class II device. We have a robust pipeline of new technologies in various stages of development and evaluation, including the anticipated expansion of our humeral stem line, indication expansions into fracture and revision, and implants tailored for metal-sensitive patients. For example, we commenced development of InSet 70, InSet 135 and InSet 185 stems to expand our I-Series humeral stem line in 2024, and we anticipate pursuing FDA clearance of these stems, as needed, over the next twelve months. We are also evaluating expansion into adjacent areas in shoulder surgical care, which may include sports medicine and shoulder trauma markets. We have contributed to numerous publications that we believe evidence and strengthen our position as a leader in shoulder surgical care. There is a significant body of clinical evidence that supports the safety, efficacy, and durability of our implants in shoulder arthroplasty, including our InSet Glenoid technology. For example, a retrospective long-term follow-up analysis of patients who received our InSet Glenoid was published in the Journal of Shoulder and Elbow Surgery in 2019, which demonstrated a 72-point improvement in the mean American Shoulder and Elbow Surgeons (“ASES”) outcome score, statistically significant improvements in pain scores and range of motion, with no surgical complications, no cases of glenoid loosening and no revision surgeries performed at a mean follow-up time of 8.7 years. We are committed to continued investment in obtaining further clinical evidence with the support of surgeons who are recognized as thought leaders in shoulder surgical care. We believe these efforts will continue to generate a substantial body of clinical evidence that will drive increased awareness and adoption of our products. We were initially formed on July 1, 2009 as Shoulder Innovations, LLC, a Delaware limited liability company. Our principal executive offices are located in Grand Rapids, MI.

About CapsoVision

We are a commercial-stage medical technology company that develops advanced imaging and artificial intelligence (“AI”) technologies that are deployed in our capsule endoscopy solutions to identify abnormalities of the gastrointestinal (“GI”) tract for diagnostic and screening purposes. We developed our first capsule endoscope system, currently comprising the CapsoCam Plus single-usecapsule and the CapsoCloud and CapsoView software, to panoramically visualize the small-bowel mucosa to investigate abnormalities such as obscure GI bleeding and Crohn’s disease. The capsule acquires and stores video images in onboard memory while moving through the GI tract, and the software component allows healthcare providers to view the video retrieved from the capsule—either by streaming it from the cloud, where it is securely stored, to anywhere, at their convenience, using our CapsoCloud software, or downloading it from the capsule themselves and reviewing it in our CapsoView software. The CapsoCam is a wire-free capsule endoscopy solution, eliminating patient-worn data recorders and providing clinicians a zero-capex, maintenance-free, flexible, and scalable workflow. The CapsoCam Plus is classified as a Class II device and has received FDA marketing authorization through the 510(k)-clearance process. We are (i) in the process of updating CapsoCam Plus to add our self-developed AI assisted reading technology and (ii) targeting related FDA 510(k) and EU submissions in the second half of 2025 and clearance of the updated capsule by the end of 2025, with commercialization shortly thereafter. Our AI assisted reading tools detect and highlight suspected abnormalities for a clinician, reducing their time to review the video and making capsule endoscopy more financially attractive to their practice. Our 510(k) submission and FDA review thereof may be delayed and we may not receive 510(k) clearance from the FDA on a timely basis or at all. We began sales of our small-bowel capsule system to our provider customers (i.e., primarily gastroenterologists practicing in clinics and/or hospitals) both internationally (in 2012) and in the U.S. (in 2017) through our global sales and marketing team. In the U.S., we sell to customers directly. Internationally, we sell both directly and through qualified exclusive distributors in specified regions. Our largest international markets (based on shipping destination) are France, Germany, and Canada. In 2023, we established a direct sales team in Germany to better serve our customers and strengthen our market presence in this key market. We plan to (i) further grow our existing sales and marketing team to increase small-bowel-related sales and (ii) leverage our existing sales and marketing team to sell future product additions to our GI-tract capsule endoscopy solution. Our revenue has increased in each year since we began U.S. direct sales in 2020. Our revenues for the years ended December 31, 2023 and 2024 totaled approximately $9.8 million and $11.8 million, respectively, representing a year-over-year growth of approximately 21%. Our revenues for the three months ended March 31, 2024 and 2025 totaled approximately $2.5 million and $2.8 million, respectively, representing a year-over-year growth of approximately 12%. The primary driver for our revenue growth was an increase in the number of CapsoCam Plus capsules sold: an increase of 19% from 2023 to 2024 and 11% from the three month period ended March 31, 2024 to the three month period ended March 31, 2025, with an increase in unit sales of 26% in the U.S. and 4% internationally from 2023 to 2024 and 10% in the U.S. and 13% internationally from the three month period ended March 31, 2024 to the three month period ended March 31, 2025. In 2023 and 2024, international sales accounted for 26% and 23% of total revenue. In the three-month periods ended March 31, 2024 and 2025, international sales accounted for 23% of total revenue. As of March 31, 2025, our small bowel capsule has been used in more than 135,000 patients worldwide and for 2024 our customer retention rate was approximately 90%. All of our revenues to date have been, and in the near-term will continue to be, generated from CapsoCam Plus related sales for the small bowel; and our ability to grow our small-bowel-related revenue is subject to our ability to successfully and timely execute related elements of our revenue growth strategy, including being able to compete effectively against our competitors (including those with an existing FDA-cleared product and that have established a market presence). To expand beyond small-bowel-related sales, we are developing our next pipeline capsule endoscope product, CapsoCam Colon. Our CapsoCam Colon capsule (i) leverages CapsoCam Plus’s existing capsule design with its panoramic view and (ii) incorporates both our self-developed AI to automatically detect polyps in the video and our polyp-size measurement tool enabled by a 3D sensor in the capsule (polyp size being highly correlated with a polyp’s risk of becoming cancer). Based on our current regulatory development plan, we are targeting CapsoCam Colon revenues beginning, in the U.S., in the second half of 2026 after receiving FDA 510(k) clearance, and in the EU, in early 2027 after receiving a CE Mark, of our second generation of CapsoCam Colon system, designed with a larger field of view and better image quality to improve accuracy, and which would be classified as a Class II device. We recently submitted our 510(k) for the first generation of our CapsoCam Colon. FDA review of our 510(k) submissions may be delayed and we may not receive 510(k) clearances from the FDA on a timely basis or at all. Longer term, we believe our CapsoCam family of products, incorporating our panoramic imaging solution, can be adapted to address new GI medical indications. Potential new medical indications include esophageal medical conditions (such as esophageal varices and Barrett’s esophagus) and pancreatic cancer. We plan to commence feasibility studies of CapsoCam’s accuracy in (i) screening esophageal varices (i.e. enlarged blood veins in the esophagus) in cirrhotic patients with portal hypertension in the second half of 2025 and (ii) detecting abnormalities indicative of cancerous and precancerous pancreatic neoplasia (abnormal cell growth) in the first half of 2026, in each case, subject to timely availability of sufficient funding and liquidity and/or potential adjustment of our clinical development priorities. Our ability to pursue our growth strategies is subject to our ability to timely and successfully meet our cash and liquidity needs (through this offering, cash generated from operations and the issuance of additional equity securities or borrowings). These efforts may be adversely impacted by our history of operating losses, accumulated deficit, and substantial doubt about our ability to continue as a going concern qualification as stated in the footnotes to our financial statements. We were incorporated under the laws of the State of Delaware on August 1, 2005, under the name “Capso Vision, Inc.” and changed our name to CapsoVision, Inc. on May 31, 2016. Our principal executive office is located in Saratoga, CA.