Reviewing Luminex (LMNX) and Valeritas (VLRX)

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Luminex (NASDAQ:LMNX) and Valeritas (NASDAQ:VLRX) are both small-cap medical companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

86.0% of Luminex shares are held by institutional investors. Comparatively, 36.5% of Valeritas shares are held by institutional investors. 8.7% of Luminex shares are held by insiders. Comparatively, 1.8% of Valeritas shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Luminex pays an annual dividend of $0.24 per share and has a dividend yield of 1.1%. Valeritas does not pay a dividend. Luminex pays out 50.0% of its earnings in the form of a dividend.

Volatility & Risk

Luminex has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500. Comparatively, Valeritas has a beta of 2.04, indicating that its stock price is 104% more volatile than the S&P 500.

Profitability

This table compares Luminex and Valeritas’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Luminex 5.81% 4.61% 4.18%
Valeritas -173.99% N/A -92.10%

Valuation & Earnings

This table compares Luminex and Valeritas’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Luminex $315.82 million 3.12 $18.51 million $0.48 45.60
Valeritas $26.40 million 1.12 -$45.93 million ($1.71) -0.17

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

Analyst Recommendations

This is a summary of recent recommendations for Luminex and Valeritas, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Luminex 0 3 1 0 2.25
Valeritas 0 0 3 0 3.00

Luminex currently has a consensus price target of $27.00, suggesting a potential upside of 23.34%. Valeritas has a consensus price target of $2.17, suggesting a potential upside of 654.67%. Given Valeritas’ stronger consensus rating and higher probable upside, analysts plainly believe Valeritas is more favorable than Luminex.

Summary

Luminex beats Valeritas on 11 of the 16 factors compared between the two stocks.

Luminex Company Profile

Luminex Corporation develops, manufactures, and sells proprietary biological testing technologies and products for the diagnostics, pharmaceutical, and research industries worldwide. Its products include Luminex 100/200 that integrates fluidics, optics, and digital signal processing; FLEXMAP 3D system for use as a general laboratory instrument; MAGPIX system, a multiplexing analyzer for qualitative and quantitative analysis of proteins and nucleic acids; ARIES system, a sample to answer real-time PCR platform; ARIES M1 system, a single-module version of the ARIES System; and VERIGENE system, a semi-automated, multiplex, molecular analysis system for the clinical diagnostics market. The company also provides MicroPlex, MagPlex, xTAG, SeroMAP, and calibration and control microspheres; xPONENT, a software suite to simplify laboratory workflow and enhance productivity; SYNCT data management software solutions; TDAS, an analysis program designed for development and optimization of nucleic acid assays; IDEAS, an image analysis software; and xTAG assays and products to identify the causative agent for respiratory and gastrointestinal infections, as well as IVD kits for cystic fibrosis genotyping and pharmacogenetic assays used to profile genetic mutations related to drug metabolism. In addition, it offers MultiCode assays and products comprising HSV 1&2 assays, and other products to detect infectious agents in clinical samples; ARIES cassettes that are self-contained assay consumables, such as ARIES HSV 1&2 assays, ARIES FLU A/B and RSV assays, ARIES group A strep assays, ARIES bordetella assays, ARIES GBS assay, and ARIES C. difficile assays; and VERIGENE test cartridges, as well as operates as an original equipment manufacturer of custom reagents and instrumentation. The company serves pharmaceutical companies, clinical laboratories, and research and medical institutions. Luminex Corporation was founded in 1995 and is based in Austin, Texas.

Valeritas Company Profile

Valeritas Holdings, Inc., a commercial-stage medical technology company, focuses on the development and commercialization of technologies to treat patients with Type 2 diabetes in the United States and China. It offers V-Go, a wearable insulin delivery device for basal-bolus therapy. The company also develops h-Patch, a controlled delivery technology platform; Mini-Ject technology for needle-free injection systems; and Micro-Trans technology for microneedle design, fabrication, and drug delivery. In addition, its products include V-Go Prefill, which is in the design-development stage for eliminating the device-filling process and the need for EZ fill refrigeration for patients with Type 2 diabetes; and V-Go Link that is in the early stages of development for real-time tracking information of basal and bolus dosing utilization. The company sells V-Go to third-party wholesalers and medical supply distributors in the United States. Valeritas Holdings, Inc. was founded in 2006 and is headquartered in Bridgewater, New Jersey.

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