Analyzing Performant Financial (NASDAQ:PFMT) and Generation Alpha (NASDAQ:GNAL)

Generation Alpha (OTCMKTS:GNAL) and Performant Financial (NASDAQ:PFMT) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, profitability, earnings, analyst recommendations, institutional ownership and dividends.

Profitability

This table compares Generation Alpha and Performant Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Generation Alpha -772.70% N/A -759.40%
Performant Financial -19.83% -13.36% -4.72%

Institutional and Insider Ownership

47.5% of Performant Financial shares are held by institutional investors. 60.8% of Generation Alpha shares are held by company insiders. Comparatively, 13.7% of Performant Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Generation Alpha and Performant Financial’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Generation Alpha $1.97 million 0.32 -$7.89 million N/A N/A
Performant Financial $150.43 million 0.74 -$26.82 million ($0.40) -5.08

Generation Alpha has higher earnings, but lower revenue than Performant Financial.

Volatility & Risk

Generation Alpha has a beta of 2.8, indicating that its share price is 180% more volatile than the S&P 500. Comparatively, Performant Financial has a beta of -0.33, indicating that its share price is 133% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Generation Alpha and Performant Financial, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Generation Alpha 0 0 0 0 N/A
Performant Financial 0 0 0 0 N/A

Generation Alpha Company Profile

Generation Alpha, Inc. focuses on the research, design, development, and manufacturing of indoor horticulture lighting and related equipment in the United States and internationally. The company offers digital ballasts; metal halide, and mercury vapor and high-pressure sodium lamps; light emitting diode lighting products that produce less heat; digital lightning controller, a temperature monitoring control system; reflectors; and high intensity ng accessories, as well as plant nutrients and fertilizers. Its primarily serves commercial and retail cannabis growers in the medical and adult use recreational markets; distributors; and retailers. Generation Alpha, Inc. markets its products directly; and through distributors to hydroponic retailers, as well as through direct contacts, online email advertising, social media, trade magazine advertising, trade show promotions, and cross-promotional offerings, as well as ecommerce websites. The company was formerly known as Solis Tek Inc. Generation Alpha, Inc. was incorporated in 2007 and is headquartered in Upland, California.

Performant Financial Company Profile

Performant Financial Corporation provides technology-enabled audit, recovery, outsource customer, and related analytics services in the United States. The company offers recovery services primarily to the government-supported student loan industry serving guaranty agencies, private financial institutions, and the Department of Education; and restructures and recovers student loans issued directly by banks to students outside of federal lending programs. It also provides audit and recovery services related to improper payments in the healthcare market; and recovery and risk management advisory services to the Department of the Treasury and various financial institutions, as well as to federal, state, and municipal tax authorities. In addition, the company offers services from post-and pre-payment audit of healthcare claims to detection of fraud, waste and abuse of healthcare claims, to coordination of benefits and pharmacy fraud detection. The company was formerly known as DCS Holdings, Inc. and changed its name to Performant Financial Corporation in 2005. Performant Financial Corporation was founded in 1976 and is headquartered in Livermore, California.

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