Orthofix International N.V. (OFIX) & Sientra (SIEN) Critical Analysis

Orthofix International N.V. (NASDAQ: OFIX) and Sientra (NASDAQ:SIEN) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Volatility & Risk

Orthofix International N.V. has a beta of 0.22, indicating that its stock price is 78% less volatile than the S&P 500. Comparatively, Sientra has a beta of -1.57, indicating that its stock price is 257% less volatile than the S&P 500.

Earnings & Valuation

This table compares Orthofix International N.V. and Sientra’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Orthofix International N.V. $418.71 million 2.11 $45.74 million $0.42 115.88
Sientra $28.68 million 10.39 -$35.42 million ($2.66) -5.80

Orthofix International N.V. has higher revenue and earnings than Sientra. Sientra is trading at a lower price-to-earnings ratio than Orthofix International N.V., indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Orthofix International N.V. and Sientra, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Orthofix International N.V. 0 0 5 0 3.00
Sientra 0 0 4 0 3.00

Orthofix International N.V. currently has a consensus target price of $52.50, suggesting a potential upside of 7.87%. Sientra has a consensus target price of $13.67, suggesting a potential downside of 11.49%. Given Orthofix International N.V.’s higher probable upside, equities research analysts clearly believe Orthofix International N.V. is more favorable than Sientra.

Profitability

This table compares Orthofix International N.V. and Sientra’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Orthofix International N.V. 1.88% 9.96% 7.32%
Sientra -173.83% -52.30% -37.51%

Institutional and Insider Ownership

94.4% of Orthofix International N.V. shares are held by institutional investors. Comparatively, 77.6% of Sientra shares are held by institutional investors. 5.6% of Orthofix International N.V. shares are held by insiders. Comparatively, 28.1% of Sientra shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Orthofix International N.V. beats Sientra on 10 of the 12 factors compared between the two stocks.

About Orthofix International N.V.

Orthofix International N.V. (Orthofix) is a global medical device company. The Company is focused on providing reconstructive and regenerative orthopedic and spine solutions to physicians. The company operates in four segments: BioStim, Biologics, Extremity Fixation and Spine Fixation. Its BioStim solutions products include Cervical-Stim, Spinal-Stim and Physio-Stim. The Biologics products include AlloQuent Structural Allografts, Trinity ELITE, Trinity Evolution and VersaShield. The Extremity Fixation products include Fixator, Eight-Plate Guided Growth System and Contours VPS Volar Plating System III. The Spine Fixation products include Hallmark Anterior Cervical Plate System, Ascent LE Posterior Occipital Cervico-Thoracic (POCT) System, Firebird Deformity Correction System, Phoenix Minimally Invasive Spinal Fixation System, Samba-Screw System, LONESTAR Cervical Stand Alone (CSA), SKYHAWK Lateral Interbody Fusion System & Lateral Plate System and CENTURION POCT System.

About Sientra

Sientra, Inc. is a medical aesthetics company. The Company’s primary products are silicone gel breast implants for use in breast augmentation and breast reconstruction procedures, which it offers in over 190 variations of shapes, sizes and textures. The Company sells its breast implants and breast tissue expanders, or breast products to plastic surgeons. Its breast implants are primarily used in elective procedures, which are generally performed on a cash-pay basis. TRUE Texture provides texturing on the implant shell that is designed to reduce the incidence of malposition, rotation and capsular contracture. The Company also offers breast tissue expanders and a range of other aesthetic and specialty products. The Company offers a range of HSC+ breast implants, including anatomically shaped textured, round textured and round smooth. The Company also offers miraDry system, the device to reduce underarm sweat, odor and permanently reduce hair of all colors.

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