Head-To-Head Review: Fractyl Health (NASDAQ:GUTS) vs. Surmodics (NASDAQ:SRDX)

Surmodics (NASDAQ:SRDX) and Fractyl Health (NASDAQ:GUTS) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, analyst recommendations, risk, institutional ownership, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent ratings for Surmodics and Fractyl Health, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Surmodics	0	4	0	0	2.00
Fractyl Health	0	0	3	0	3.00

Surmodics currently has a consensus target price of $50.00, indicating a potential upside of 26.33%. Fractyl Health has a consensus target price of $22.00, indicating a potential upside of 913.82%. Given Fractyl Health’s stronger consensus rating and higher possible upside, analysts clearly believe Fractyl Health is more favorable than Surmodics.

Institutional and Insider Ownership

96.6% of Surmodics shares are held by institutional investors. 8.9% of Surmodics shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Surmodics and Fractyl Health”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Surmodics	$126.08 million	4.50	-$11.54 million	($0.81)	-48.86
Fractyl Health	$97,000.00	1,076.03	-$77.09 million	($12.19)	-0.18

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

Profitability

This table compares Surmodics and Fractyl Health’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Surmodics	-9.15%	-3.79%	-2.55%
Fractyl Health	-64,849.48%	N/A	-57.21%

Summary

Surmodics beats Fractyl Health on 7 of the 13 factors compared between the two stocks.

About Surmodics

Surmodics, Inc., together with its subsidiaries, provides performance coating technologies for intravascular medical devices, and chemical and biological components for in vitro diagnostic immunoassay tests and microarrays in the United States and internationally. It operates through two segments, Medical Device and In Vitro Diagnostics (IVD). The Medical Device segment engages in the provision of surface modification coating technologies to enhance access, deliverability, and predictable deployment of medical devices; and drug-delivery coating technologies to provide site-specific drug-delivery from the surface of a medical device for neurovascular, peripheral, coronary, and structural heart, and other markets, as well as manufacturing of vascular intervention medical devices, including drug-coated balloons, mechanical thrombectomy devices, and radial access balloon catheters and guide sheaths. The IVD segment develops, manufactures, and sells chemical and biological components for in vitro diagnostic immunoassay and molecular tests, as well as diagnostic and biomedical research markets. This segment offers protein stabilizers, substrates, surface coatings, and antigens. The company was founded in 1979 and is headquartered in Eden Prairie, Minnesota.

About Fractyl Health

Fractyl Health, Inc., a metabolic therapeutics company, develops therapies for the treatment of type 2 diabetes (T2D) and obesity. The company develops Revita DMR System (Revita), an outpatient procedural therapy designed to durably modify duodenal dysfunction, a pathologic consequence of a high fat and high sugar diet, which can initiate T2D and obesity in humans. It also develops Rejuva, a novel adeno-associated virus delivered pancreatic gene therapy platform that is designed to enable long-term remission of T2D and obesity by durably altering metabolic hormone function in the pancreatic islet cells of patients. Fractyl Health, Inc. was formerly known as Fractyl Laboratories Inc. and changed its name to Fractyl Health, Inc. on June 09, 2021. The company was incorporated in 2010 and is headquartered in Burlington, Massachusetts.