K2M Group (KTWO) vs. Cryolife (CRY) Critical Comparison

K2M Group (NASDAQ: KTWO) and Cryolife (NYSE:CRY) are both small-cap medical companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, analyst recommendations, risk, valuation, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for K2M Group and Cryolife, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
K2M Group 0 1 8 0 2.89
Cryolife 0 0 4 0 3.00

K2M Group currently has a consensus target price of $24.38, indicating a potential upside of 41.80%. Cryolife has a consensus target price of $23.63, indicating a potential upside of 24.67%. Given K2M Group’s higher probable upside, equities research analysts clearly believe K2M Group is more favorable than Cryolife.

Profitability

This table compares K2M Group and Cryolife’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
K2M Group -16.22% -16.02% -10.73%
Cryolife 5.28% 6.43% 4.33%

Risk & Volatility

K2M Group has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, Cryolife has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500.

Insider & Institutional Ownership

99.2% of K2M Group shares are owned by institutional investors. Comparatively, 73.3% of Cryolife shares are owned by institutional investors. 5.8% of K2M Group shares are owned by company insiders. Comparatively, 6.0% of Cryolife shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares K2M Group and Cryolife’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
K2M Group $236.63 million 3.15 -$41.66 million ($0.97) -17.72
Cryolife $180.38 million 3.52 $10.77 million $0.28 67.68

Cryolife has lower revenue, but higher earnings than K2M Group. K2M Group is trading at a lower price-to-earnings ratio than Cryolife, indicating that it is currently the more affordable of the two stocks.

Summary

Cryolife beats K2M Group on 8 of the 13 factors compared between the two stocks.

K2M Group Company Profile

K2M Group Holdings, Inc. is a medical device company focused on designing, developing and commercializing spine and minimally invasive technologies and techniques. The Company’s solutions are focused on achieving three-dimensional Total Body Balance. Its spine products are used by spine surgeons to treat spinal pathologies, such as deformity (primarily scoliosis), trauma and tumor. Its products consist of implants, disposables and instruments, which are marketed and sold primarily to hospitals for use by spine surgeons. As of December 31, 2016, its product portfolio consisted of 83 product lines that are used in complex spine, minimally invasive surgery (MIS) and degenerative surgeries. Its technologies include EVEREST, MESA, Rail 4D, Quicket Deformity, CASCADIA, CAPRI, SERENGETI, RAVINE and tifix. Its degenerative spine technologies are used to treat degenerative spine disorders and include products, such as cervical, thoracic and lumbar spinal fusion devices and interbody devices.

Cryolife Company Profile

CryoLife, Inc. (CryoLife) is a medical device manufacturer and processor, and is engaged in the distribution of medical devices and implantable human tissues used in cardiac surgical procedures. The Company operates through two segments: Medical Devices and Preservation Services. The Medical Devices segment includes medical devices, such as BioGlue Surgical Adhesive, BioFoam Surgical Matrix, On-X Life Technologies Holdings, Inc. valves and surgical products, CardioGenesis cardiac laser therapy product line, PerClot and PhotoFix. PhotoFix is a pericardial patch stabilized using a dye-mediated photo-fixation process that requires no glutaraldehyde. The Preservation Services segment includes external services, such as preservation of cardiac and vascular tissues. The cardiac and vascular human tissues distributed by CryoLife include the CryoValve SG pulmonary heart valve and the CryoPatch SG pulmonary cardiac patch, both of which are processed using CryoLife’s SynerGraft technology.

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