Clover Health Investments (NASDAQ:CLOV – Get Free Report) and Outset Medical (NASDAQ:OM – Get Free Report) are both small-cap medical companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, risk, institutional ownership and valuation.
Volatility & Risk
Clover Health Investments has a beta of 2.09, indicating that its stock price is 109% more volatile than the S&P 500. Comparatively, Outset Medical has a beta of 2.08, indicating that its stock price is 108% more volatile than the S&P 500.
Profitability
This table compares Clover Health Investments and Outset Medical’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Clover Health Investments | -3.29% | -16.79% | -9.95% |
| Outset Medical | -68.34% | -53.37% | -28.03% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Clover Health Investments | $1.77 billion | 0.59 | -$43.01 million | ($0.11) | -18.36 |
| Outset Medical | $119.48 million | 0.52 | -$127.98 million | ($6.79) | -0.50 |
Clover Health Investments has higher revenue and earnings than Outset Medical. Clover Health Investments is trading at a lower price-to-earnings ratio than Outset Medical, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
19.8% of Clover Health Investments shares are held by institutional investors. 24.1% of Clover Health Investments shares are held by insiders. Comparatively, 2.4% of Outset Medical shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Clover Health Investments and Outset Medical, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Clover Health Investments | 1 | 3 | 1 | 0 | 2.00 |
| Outset Medical | 1 | 1 | 2 | 1 | 2.60 |
Clover Health Investments currently has a consensus price target of $3.23, suggesting a potential upside of 60.07%. Outset Medical has a consensus price target of $10.00, suggesting a potential upside of 194.99%. Given Outset Medical’s stronger consensus rating and higher probable upside, analysts clearly believe Outset Medical is more favorable than Clover Health Investments.
Summary
Clover Health Investments beats Outset Medical on 10 of the 15 factors compared between the two stocks.
About Clover Health Investments
Clover Health Investments, Corp. provides medicare advantage plans in the United States. It operates through two segments: Insurance and Non-Insurance. It also offers Clover Assistant, a cloud-based software platform, that enables physicians to detect, identify, and manage chronic diseases earlier; and access to data-driven and personalized insights for the patients they treat. Clover Health Investments, Corp. is based in Franklin, Tennessee.
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.
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