Financial Review: iCAD (NASDAQ:ICAD) vs. Tandem Diabetes Care (NASDAQ:TNDM)

Tandem Diabetes Care (NASDAQ:TNDM) and iCAD (NASDAQ:ICAD) are both medical companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Volatility and Risk

Tandem Diabetes Care has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, iCAD has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500.

Profitability

This table compares Tandem Diabetes Care and iCAD’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tandem Diabetes Care	-29.77%	-31.48%	-10.75%
iCAD	-27.08%	-21.63%	-15.22%

Earnings & Valuation

This table compares Tandem Diabetes Care and iCAD’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tandem Diabetes Care	$747.72 million	2.75	-$222.61 million	($3.44)	-9.26
iCAD	$17.32 million	2.50	-$4.85 million	($0.22)	-7.41

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

Analyst Recommendations

This is a summary of recent recommendations for Tandem Diabetes Care and iCAD, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tandem Diabetes Care	1	6	5	0	2.33
iCAD	0	0	0	0	N/A

Tandem Diabetes Care presently has a consensus price target of $37.00, indicating a potential upside of 16.13%. iCAD has a consensus price target of $5.00, indicating a potential upside of 206.75%. Given iCAD’s higher probable upside, analysts plainly believe iCAD is more favorable than Tandem Diabetes Care.

Insider and Institutional Ownership

24.6% of iCAD shares are held by institutional investors. 2.5% of Tandem Diabetes Care shares are held by insiders. Comparatively, 12.0% of iCAD shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

iCAD beats Tandem Diabetes Care on 9 of the 13 factors compared between the two stocks.

About Tandem Diabetes Care

Tandem Diabetes Care, Inc., a medical device company, designs, develops, and commercializes technology solutions for people living with diabetes in the United States and internationally. The company's flagship product is the t:slim X2 insulin delivery system, a pump platform for managing insulin delivery and display continuous glucose monitoring sensor information directly on the pump home screen; and Tandem Mobi insulin pump, an automated insulin delivery system. It also sells single-use products, including cartridges for storing and delivering insulin, and infusion sets that connect the insulin pump to the user's body. In addition, the company offers Tandem Device Updater used to update the pump software from a personal computer; Tandem Source, a web-based data management platform, which provides a visual way to display diabetes therapy management data from the pumps, integrated CGMs, and supported blood glucose meters; and Sugarmate, a mobile app used to help people visualize diabetes therapy data. The company was formerly known as Phluid Inc. and changed its name to Tandem Diabetes Care, Inc. in January 2008. Tandem Diabetes Care, Inc. was incorporated in 2006 and is headquartered in San Diego, California.

About iCAD

iCAD, Inc. engages in the provision of cancer detection and therapy solutions in the United States. It operates through two segments, Cancer Detection and Cancer Therapy. The company's breast AI suite includes cancer detection, automated density assessment, and breast cancer risk assessment solutions for both 2D and 3D mammography. It offers PowerLook, a back-end architecture platform, which hosts the AI algorithm solutions and manages the communications between imaging acquisition systems, and image storage and review systems; SecondLook, a machine learning-based cancer detection algorithm that analyzes 2D full-field digital mammography images to identify and mark suspicious masses and calcifications; and PowerLook Density Assessment provides automated, consistent, and standardized breast density assessments. The company also offers ProFound AI, a deep-learning algorithm designed to detect malignant soft-tissue densities and calcifications in digital breast tomosynthesis; ProFound AI Risk, a clinical decision support tool that provides breast cancer risk estimation based on a screening mammogram; and VeraLook, a solution designed to support detection of colonic polyps in conjunction with Computed Tomography Colonography. In addition, it offers Xoft Axxent electronic brachytherapy systems for the treatment of early-stage breast, non-melanoma skin, and gynecological cancers to university research and community hospitals, cancer care clinics, veterinary facilities, and dermatology offices. The company sells its products through direct sales organizations, as well as through various original equipment manufacturer partners, distributors, technology platform partners, and resellers. It also exports its products in Europe, Taiwan, Canada, China, and internationally. The company was formerly known as Howtek, Inc. and changed its name to iCAD, Inc. in June 2002. iCAD, Inc. was incorporated in 1984 and is headquartered in Nashua, New Hampshire.