Surmodics (NASDAQ:SRDX – Get Free Report) and AtriCure (NASDAQ:ATRC – Get Free Report) are both small-cap medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.
Earnings and Valuation
This table compares Surmodics and AtriCure”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Surmodics | $126.08 million | 4.42 | -$11.54 million | ($0.81) | -48.15 |
| AtriCure | $447.57 million | 3.67 | -$30.44 million | ($0.83) | -40.55 |
Surmodics has higher earnings, but lower revenue than AtriCure. Surmodics is trading at a lower price-to-earnings ratio than AtriCure, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Surmodics and AtriCure, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Surmodics | 0 | 4 | 0 | 0 | 2.00 |
| AtriCure | 0 | 0 | 8 | 0 | 3.00 |
Surmodics currently has a consensus price target of $50.00, indicating a potential upside of 28.21%. AtriCure has a consensus price target of $42.00, indicating a potential upside of 24.78%. Given Surmodics’ higher probable upside, research analysts plainly believe Surmodics is more favorable than AtriCure.
Profitability
This table compares Surmodics and AtriCure’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Surmodics | -9.15% | -3.79% | -2.55% |
| AtriCure | -8.70% | -8.12% | -6.21% |
Insider & Institutional Ownership
96.6% of Surmodics shares are held by institutional investors. Comparatively, 99.1% of AtriCure shares are held by institutional investors. 8.9% of Surmodics shares are held by company insiders. Comparatively, 3.2% of AtriCure shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
About Surmodics
Surmodics, Inc., together with its subsidiaries, provides performance coating technologies for intravascular medical devices, and chemical and biological components for in vitro diagnostic immunoassay tests and microarrays in the United States and internationally. It operates through two segments, Medical Device and In Vitro Diagnostics (IVD). The Medical Device segment engages in the provision of surface modification coating technologies to enhance access, deliverability, and predictable deployment of medical devices; and drug-delivery coating technologies to provide site-specific drug-delivery from the surface of a medical device for neurovascular, peripheral, coronary, and structural heart, and other markets, as well as manufacturing of vascular intervention medical devices, including drug-coated balloons, mechanical thrombectomy devices, and radial access balloon catheters and guide sheaths. The IVD segment develops, manufactures, and sells chemical and biological components for in vitro diagnostic immunoassay and molecular tests, as well as diagnostic and biomedical research markets. This segment offers protein stabilizers, substrates, surface coatings, and antigens. The company was founded in 1979 and is headquartered in Eden Prairie, Minnesota.
About AtriCure
AtriCure, Inc. develops, manufactures, and sells devices for surgical ablation of cardiac tissue, exclusion of the left atrial appendage, and temporarily blocking pain by ablating peripheral nerves to medical centers in the United States, Europe, the Asia-Pacific, and internationally. The company offers Isolator Synergy Clamps, single-use disposable radio frequency products; multifunctional pens and linear ablation devices, such as the MAX Pen device that enables surgeons to evaluate cardiac arrhythmias, perform temporary cardiac pacing, sensing, and stimulation, and ablate cardiac tissue with the same device; and the Coolrail device, which enables users to make longer linear lines of ablation. It also provides cryoICE Cryoablation System that enables the user to make linear ablations of varied lengths; EPi-Sense Systems, a single-use disposable device used for the treatment of symptomatic, drug-refractory, and long-standing persistent atrial fibrillation; cryoSPHERE probe, which provides temporary pain relief by applying cryothermic energy to targeted intercoastal peripheral nerves in the ribcage; AtriClip System, an implantable device coupled to a single-use disposable applier; and LARIAT System, a suture-based solution for soft-tissue closure. In addition, the company sells Lumitip dissectors to separate tissues to provide access to key anatomical structures that are targeted for ablation; Glidepath guides for placement of clamps; Subtle Cannula's to support access for EPi-Sense catheters; and various reusable cardiac surgery instruments. It markets and sells its products through independent distributors and direct sales personnel. The company was incorporated in 2000 and is headquartered in Mason, Ohio.
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