Reviewing Covalon Technologies (OTCMKTS:CVALF) & Talkspace (NASDAQ:TALK)

Covalon Technologies (OTCMKTS:CVALF) and Talkspace (NASDAQ:TALK) are both small-cap medical companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, earnings, risk and dividends.

Analyst Recommendations

This is a summary of current ratings and target prices for Covalon Technologies and Talkspace, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Covalon Technologies	0	0	0	0	0.00
Talkspace	0	2	0	0	2.00

Talkspace has a consensus target price of $3.00, suggesting a potential downside of 1.32%. Given Talkspace’s stronger consensus rating and higher probable upside, analysts clearly believe Talkspace is more favorable than Covalon Technologies.

Earnings and Valuation

This table compares Covalon Technologies and Talkspace”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Covalon Technologies	$19.72 million	3.98	-$3.31 million	($0.03)	-95.50
Talkspace	$150.04 million	3.42	-$19.18 million	($0.01)	-304.00

Covalon Technologies has higher earnings, but lower revenue than Talkspace. Talkspace is trading at a lower price-to-earnings ratio than Covalon Technologies, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Covalon Technologies has a beta of -0.34, indicating that its stock price is 134% less volatile than the S&P 500. Comparatively, Talkspace has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.

Institutional and Insider Ownership

57.4% of Talkspace shares are owned by institutional investors. 21.7% of Talkspace shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Covalon Technologies and Talkspace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Covalon Technologies	-2.94%	-4.40%	-3.54%
Talkspace	-0.76%	-1.17%	-0.99%

Summary

Talkspace beats Covalon Technologies on 10 of the 13 factors compared between the two stocks.

About Covalon Technologies

Covalon Technologies Ltd. engages in the research, development, manufacturing, and marketing of medical products in infection management, advanced wound care, and surgical procedure areas in the United States, Canada, the Middle East, Asia, Latin America, and internationally. The company’s platform technologies comprise collagen matrix platform that is used to manufacture a family of products to treat chronic and infected wounds, including diabetic ulcers, pressure ulcers, venous ulcers, donor and graft sites, traumatic wounds healing by secondary intention, dehisced surgical wounds, and first and second degree burns; and antimicrobial silicone adhesive platform, which is used for family of pre and post-surgical, and vascular access products that are designed to kill bacteria or yeast that comes into contact with the antimicrobial silicone providing broad-spectrum antimicrobial activity. It also offers medical coating platform, a process that utilizes photo-polymerization to create active grafting sites where new polymer chains are initiated and propagated from the surface of an existing medical device. In addition, the company provides wound care dressings; surgical and peri-operative; and infection management products. It offers its products under the Covalon brand name through third-party distribution networks and company’s direct sales force. The company serves hospitals, wound care centers, burn centers, extended/alternate care and acute care facilities, home health care agencies, and physicians’ offices. Covalon Technologies Ltd. is headquartered in Mississauga, Canada.

About Talkspace

Talkspace, Inc. operates as a virtual behavioral healthcare company in the United States. The company offers psychotherapy and psychiatry services through its platform to individuals, enterprises, and health plans and employee assistance programs. It provides text, audio, and video-based psychotherapy from licensed therapists. The company offers Talkspace Employee Assistance Program (EAP) and Talkspace Behavioral Health plan (BH) that provides online therapy to members through BH and EAP offerings; and Talkspace for Business for members to access its platform services on a benefit plan paid by the enterprise. It serves its platform through third-party platforms or marketplace, such as Apple App Store and Google Play App Store. Talkspace, Inc. was founded in 2012 and is headquartered in New York, New York.