Reviewing Outset Medical (NASDAQ:OM) & Predictive Oncology (NASDAQ:POAI)

Predictive Oncology (NASDAQ:POAI) and Outset Medical (NASDAQ:OM) are both small-cap medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitability and dividends.

Insider and Institutional Ownership

9.0% of Predictive Oncology shares are held by institutional investors. 1.2% of Predictive Oncology shares are held by insiders. Comparatively, 2.4% of Outset Medical shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Predictive Oncology and Outset Medical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Predictive Oncology	$1.62 million	12.83	-$12.66 million	($13.50)	-0.45
Outset Medical	$113.69 million	0.73	-$127.98 million	($13.05)	-0.35

Predictive Oncology has higher earnings, but lower revenue than Outset Medical. Predictive Oncology is trading at a lower price-to-earnings ratio than Outset Medical, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Predictive Oncology has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500. Comparatively, Outset Medical has a beta of 2.14, suggesting that its stock price is 114% more volatile than the S&P 500.

Profitability

This table compares Predictive Oncology and Outset Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Predictive Oncology	-5,065.23%	-732.73%	-235.55%
Outset Medical	-73.12%	-71.37%	-30.11%

Analyst Recommendations

This is a summary of current recommendations and price targets for Predictive Oncology and Outset Medical, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Predictive Oncology	1	0	0	0	1.00
Outset Medical	1	1	2	1	2.60

Outset Medical has a consensus target price of $16.00, suggesting a potential upside of 250.88%. Given Outset Medical’s stronger consensus rating and higher possible upside, analysts clearly believe Outset Medical is more favorable than Predictive Oncology.

Summary

Outset Medical beats Predictive Oncology on 12 of the 15 factors compared between the two stocks.

About Predictive Oncology

Predictive Oncology Inc. operates as a science-driven company on the oncology drug discovery. It provides various solutions for the oncology drug development. The company, through the integration of scientific rigor and machine learning, has developed the ability to advance molecules into medicine by introducing human diversity earlier into the discovery process with the pairing of artificial intelligence and the biobank of approximately 150K tumor samples. It operates through four segments: Helomics, zPREDICTA, Soluble, and Skyline. The Helomics segment provides services that include the application of AI, collaboration projects, and clinical testing. The zPREDICTA segment develops organ-specific disease models that provide 3D reconstruction of human tissues representing each disease state and mimicking drug response for testing of anticancer agents. The Soluble segment provides services using a self-contained automated system that conducts self-interaction chromatography screens using additives and excipients included in protein formulations resulting in soluble and physically stable formulations for biologics. This segment also offers protein stability analysis services; protein solubility kits that allow rapid identification of soluble formulations; and proprietary technologies for bacterial endotoxin detection and removal. The Skyline segment provides STREAMWAY System, a wall-mounted fully automated system, which virtually eliminates exposure to blood, irrigation fluid, and other infectious fluids found in the healthcare environment. The company was formerly known as Precision Therapeutics Inc. and changed its name to Predictive Oncology Inc. in June 2019. Predictive Oncology Inc. was incorporated in 2002 and is headquartered in Eagan, Minnesota.

About Outset Medical

Outset Medical, Inc., a medical technology company, engages in the development of a hemodialysis system for hemodialysis in the United States. The company offers Tablo Hemodialysis System, a compact console with integrated water purification, on-demand dialysate production, and software and connectivity capabilities for dialysis care in acute and home settings; and manufactures, supports, and distributes for Tablo console, Tablo cartridge, and other consumables. It also provides Tablo Data Ecosystem, including TabloHub, a customer-facing portal; MyTablo, a patient-facing portal; and TabloDash, an internal data analytics platform. The company was formerly known as Home Dialysis Plus, Ltd. and changed its name to Outset Medical, Inc. in January 2015. Outset Medical, Inc. was incorporated in 2003 and is headquartered in San Jose, California.