Accuray (NASDAQ:ARAY – Get Free Report) and Neuronetics (NASDAQ:STIM – Get Free Report) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.
Volatility & Risk
Accuray has a beta of 1.45, indicating that its share price is 45% more volatile than the S&P 500. Comparatively, Neuronetics has a beta of 2.32, indicating that its share price is 132% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Accuray and Neuronetics, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Accuray | 0 | 0 | 3 | 0 | 3.00 |
| Neuronetics | 0 | 1 | 3 | 0 | 2.75 |
Earnings and Valuation
This table compares Accuray and Neuronetics’ top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Accuray | $446.55 million | 0.49 | -$9.28 million | ($0.22) | -10.09 |
| Neuronetics | $71.35 million | 0.37 | -$30.19 million | ($0.96) | -0.91 |
Accuray has higher revenue and earnings than Neuronetics. Accuray is trading at a lower price-to-earnings ratio than Neuronetics, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
64.1% of Accuray shares are owned by institutional investors. Comparatively, 53.6% of Neuronetics shares are owned by institutional investors. 3.8% of Accuray shares are owned by insiders. Comparatively, 9.8% of Neuronetics shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Profitability
This table compares Accuray and Neuronetics’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Accuray | -4.99% | -44.46% | -4.54% |
| Neuronetics | -45.06% | -109.00% | -31.72% |
Summary
Accuray beats Neuronetics on 9 of the 13 factors compared between the two stocks.
About Accuray
Accuray Incorporated designs, develops, manufactures, and sells radiosurgery and radiation therapy systems for the treatment of tumors in the United States, Canada, Latin America, Australia, New Zealand, Europe, the Middle East, India, Africa, Japan, China, and rest of the Asia Pacific region. It offers the CyberKnife System, a robotic stereotactic radiosurgery and stereotactic body radiation therapy system used for the treatment of primary and metastatic tumors outside the brain, including tumors on or near the spine and in the breast, kidney, liver, lung, pancreas, and prostate. The company also provides the TomoTherapy System, including the Radixact System, which allows for integrated radiation treatment planning, delivery, and data management, enabling clinicians to deliver ultra-precise treatments to approximately 50 patients per day; iDMS data management system, a fully integrated treatment planning and data management systems; and Accuray precision treatment planning system, a treatment planning and data management systems. In addition, it offers post-contract customer support, installation, training, and other professional services. The company primarily markets its products directly to customers, including hospitals and stand-alone treatment facilities through its sales organization, as well as to customers through sales agents and group purchasing organizations in the United States; and to customers directly and through distributors and sales agents internationally. Accuray Incorporated was incorporated in 1990 and is headquartered in Madison, Wisconsin.
About Neuronetics
Neuronetics, Inc., a commercial stage medical technology company, designs, develops, and markets products for patients with neurohealth disorders in the United States and internationally. The company offers NeuroStar Advanced Therapy System, a non-invasive and non-systemic office-based treatment to treat adult patients with major depressive disorder. Its NeuroStar Advanced Therapy System uses transcranial magnetic stimulation to create a pulsed, MRI-strength magnetic field that induces electrical currents designed to stimulate specific areas of the brain associated with mood. The company sells its products through its sales and customer support team to psychiatrists. The company was incorporated in 2001 and is headquartered in Malvern, Pennsylvania.
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