OrthoPediatrics (NASDAQ:KIDS – Get Free Report) and Check-Cap (NASDAQ:CHEK – Get Free Report) are both small-cap medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, earnings, dividends, profitability and analyst recommendations.
Risk & Volatility
OrthoPediatrics has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500. Comparatively, Check-Cap has a beta of 0.41, suggesting that its share price is 59% less volatile than the S&P 500.
Profitability
This table compares OrthoPediatrics and Check-Cap’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| OrthoPediatrics | -20.06% | -6.85% | -5.00% |
| Check-Cap | N/A | N/A | N/A |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| OrthoPediatrics | $227.41 million | 1.88 | -$37.82 million | ($1.95) | -8.72 |
| Check-Cap | N/A | N/A | -$25.15 million | ($2.77) | -0.60 |
Check-Cap has lower revenue, but higher earnings than OrthoPediatrics. OrthoPediatrics is trading at a lower price-to-earnings ratio than Check-Cap, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
69.1% of OrthoPediatrics shares are owned by institutional investors. Comparatively, 1.1% of Check-Cap shares are owned by institutional investors. 32.7% of OrthoPediatrics shares are owned by insiders. Comparatively, 0.5% of Check-Cap shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for OrthoPediatrics and Check-Cap, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| OrthoPediatrics | 1 | 1 | 7 | 0 | 2.67 |
| Check-Cap | 1 | 0 | 0 | 0 | 1.00 |
OrthoPediatrics presently has a consensus price target of $24.00, indicating a potential upside of 41.09%. Given OrthoPediatrics’ stronger consensus rating and higher possible upside, equities research analysts plainly believe OrthoPediatrics is more favorable than Check-Cap.
Summary
OrthoPediatrics beats Check-Cap on 8 of the 13 factors compared between the two stocks.
About OrthoPediatrics
OrthoPediatrics Corp., a medical device company, engages in designing, developing, and marketing anatomically appropriate implants, instruments, and specialized braces for children with orthopedic conditions in the United States and internationally. The company offers pediatric trauma and deformity correction products; scoliosis procedures for the treatment of spinal deformity; and sports medicine and other products. Its products comprise PediLoc, PediPlates, cannulated screws, PediFlex nail, PediNail, PediLoc Tibia, ACL Reconstruction System, Locking Cannulated Blade, Locking Proximal Femur, Spica Tables, RESPONSE Spine, BandLoc, Pediguard, Pediatric Nailing Platform | Femur, Devise Rail, Orthex, The Fassier-Duval Telescopic Intramedullary System, SLIMTM Nail, The GAP Nail, The Free Gliding SCFE Screw System, GIROTM Growth Modulation System, PNP Tibia System, ApiFix Mid-C System, and Mitchell Ponseti. The company serves pediatric orthopedic market, as well as pediatric orthopedic surgeons and caregivers. OrthoPediatrics Corp. was founded in 2006 and is headquartered in Warsaw, Indiana.
About Check-Cap
Check-Cap Ltd., a clinical stage medical diagnostics company, engages in the development of a capsule-based screening technology that utilizes ultra-low-dose X-rays to scan the inner lining of the colon for precancerous polyps, and other structural abnormalities in Israel. Its C-Scan system consists of C-Scan Cap, an X-ray scanning capsule for detection of suspected polyps; C-Scan Track, a disposable system attached to the patient's back through biocompatible adhesive skin patches; and C-Scan View software, a client/server-based application that enables procedure data download from the C-Scan Track, data analysis, and report generation. Check-Cap Ltd. was incorporated in 2004 and is based in Isfiya, Israel.
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