Analyzing IRIDEX (NASDAQ:IRIX) and InMode (NASDAQ:INMD)

IRIDEX (NASDAQ:IRIX) and InMode (NASDAQ:INMD) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, profitability, valuation and earnings.

Insider and Institutional Ownership

48.5% of IRIDEX shares are owned by institutional investors. 5.0% of IRIDEX shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares IRIDEX and InMode’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IRIDEX -26.02% -39.42% -27.74%
InMode N/A N/A N/A

Earnings and Valuation

This table compares IRIDEX and InMode’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
IRIDEX $42.60 million 0.62 -$12.81 million ($1.05) -1.83
InMode N/A N/A N/A N/A N/A

InMode has lower revenue, but higher earnings than IRIDEX.

Analyst Recommendations

This is a breakdown of current ratings and target prices for IRIDEX and InMode, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IRIDEX 0 0 2 0 3.00
InMode 0 0 4 0 3.00

IRIDEX currently has a consensus target price of $8.50, indicating a potential upside of 342.71%. InMode has a consensus target price of $28.00, indicating a potential upside of 14.94%. Given IRIDEX’s higher possible upside, research analysts plainly believe IRIDEX is more favorable than InMode.

About IRIDEX

IRIDEX Corporation, an ophthalmic medical technology company, provides therapeutic based laser systems, delivery devices, and consumable instrumentation to treat sight-threatening eye diseases in ophthalmology. The company offers laser consoles, such as Cyclo G6 laser system for use in the treatment of glaucoma; IQ 532 and IQ 577 laser systems, which are used for the treatment of diabetic macular edema and other retinal diseases; and OcuLight TX, OcuLight SL, OcuLight SLx, OcuLight GL, and OcuLight GLx laser systems, which are used to treat proliferative diabetic retinopathy, macular holes, retinal tears, and detachments. It also provides delivery devices, including TxCell scanning laser delivery system that allows the physician to perform multi-spot pattern scanning; and slit lamp adapter, which allows the physician to utilize a standard slit lamp in diagnosis and treatment procedures. In addition, the company offers MicroPulse P3 Probe, which is used with its Cylco G6 laser system that delivers laser to treat glaucoma; G-Probe, which is used in procedures to treat uncontrolled glaucoma; G-Probe Illuminate and G-Probe Illuminate, which are used in procedures to treat refractory glaucoma; and EndoProbe family of products used in vitrectomy procedures. It serves ophthalmologists, research and teaching hospitals, government installations, surgical centers, hospitals, and office clinics. IRIDEX Corporation markets its products through direct and independent sales force in the United States, as well as through independent distributors internationally. The company was formerly known as IRIS Medical Instruments, Inc. and changed its name to IRIDEX Corporation in November 1995. IRIDEX Corporation was founded in 1989 and is headquartered in Mountain View, California.

About InMode

InMode Ltd. designs, develops, manufactures, and markets minimally-invasive aesthetic medical products based on its proprietary radio frequency assisted lipolysis and deep subdermal fractional radio frequency technologies. The company offers minimally-invasive aesthetic medical products for procedures, such as liposuction with simultaneous skin tightening, body and face contouring, and ablative skin rejuvenation treatments. It also designs, develops, manufactures, and markets non-invasive medical aesthetic products that target an array of procedures, including permanent hair reduction, facial skin rejuvenation, wrinkle reduction, cellulite treatment, skin appearance and texture, and superficial benign vascular and pigmented lesions. InMode Ltd. offers its products directly in the United States, Canada, the United Kingdom, Spain, and India, as well as indirectly through third-party distributors internationally. The company was formerly known as Invasix Ltd. and changed its name to InMode Ltd. in November 2017. InMode Ltd. was founded in 2008 and is headquartered in Yokneam, Israel.

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