Contrasting NeuroPace (NASDAQ:NPCE) & Cerus (NASDAQ:CERS)

Cerus (NASDAQ:CERS) and NeuroPace (NASDAQ:NPCE) are both small-cap medical companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, valuation, profitability and analyst recommendations.

Insider and Institutional Ownership

78.4% of Cerus shares are held by institutional investors. Comparatively, 78.8% of NeuroPace shares are held by institutional investors. 3.4% of Cerus shares are held by company insiders. Comparatively, 22.2% of NeuroPace shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

Cerus has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500. Comparatively, NeuroPace has a beta of 1.79, meaning that its stock price is 79% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Cerus and NeuroPace, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cerus	0	1	3	0	2.75
NeuroPace	0	1	5	0	2.83

Cerus currently has a consensus target price of $3.63, suggesting a potential upside of 107.21%. NeuroPace has a consensus target price of $14.60, suggesting a potential upside of 62.58%. Given Cerus’ higher possible upside, equities analysts plainly believe Cerus is more favorable than NeuroPace.

Profitability

This table compares Cerus and NeuroPace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cerus	-11.19%	-37.90%	-10.35%
NeuroPace	-36.74%	-205.41%	-28.29%

Earnings & Valuation

This table compares Cerus and NeuroPace”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cerus	$156.37 million	2.08	-$37.49 million	($0.11)	-15.90
NeuroPace	$65.42 million	4.10	-$32.96 million	($1.00)	-8.98

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

Summary

NeuroPace beats Cerus on 8 of the 14 factors compared between the two stocks.

About Cerus

Cerus Corporation operates as a biomedical products company. The company focuses on developing and commercializing the INTERCEPT Blood System to enhance blood safety. Its INTERCEPT Blood System, a proprietary technology for controlling biological replication that is designed to reduce blood-borne pathogens in donated blood components intended for transfusion. The company offers INTERCEPT Blood Systems for platelets and plasma, which is designed to inactivate blood-borne pathogens in platelets and plasma donated for transfusion; INTERCEPT Blood System for red blood cells to inactivate blood-borne pathogens in red blood cells donated for transfusion; and INTERCEPT Blood System for Cryoprecipitation that uses its plasma system to produce pathogen reduced cryoprecipitated fibrinogen complex for the treatment and control of bleeding, including massive hemorrhage associated with fibrinogen deficiency, as well as pathogen reduced plasma, cryoprecipitate reduced. It sells platelet and plasma systems through its direct sales force and distributors in the United States, Europe, the Commonwealth of Independent States, the Middle East, Latin America, and internationally. Cerus Corporation was incorporated in 1991 and is headquartered in Concord, California.

About NeuroPace

NeuroPace, Inc. operates as a medical device company in the United States. The company develops RNS system, a brain-responsive neuromodulation system that delivers personalized, real-time treatment at the seizure source for treating medically refractory focal epilepsy. It also records continuous brain activity data and enables clinicians to monitor patients in person and remotely. Its RNS System includes RNS neurostimulator, cortical strip and depth leads, and Patient Remote Monitor, as well as other implantable and non-implantable accessories. The company sells its products to hospital facilities for initial RNS system implant procedures and for replacement procedures. NeuroPace, Inc. was incorporated in 1997 and is headquartered in Mountain View, California.