Head-To-Head Review: Rockwell Medical (RMTI) versus Reshape Lifesciences (RSLS)

Rockwell Medical (NASDAQ: RMTI) and Reshape Lifesciences (NASDAQ:RSLS) are both small-cap medical companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, valuation, analyst recommendations, profitability and earnings.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Rockwell Medical and Reshape Lifesciences, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rockwell Medical 0 0 0 1 4.00
Reshape Lifesciences 0 0 0 0 N/A

Rockwell Medical currently has a consensus target price of $11.00, suggesting a potential upside of 112.77%. Given Rockwell Medical’s higher possible upside, equities analysts clearly believe Rockwell Medical is more favorable than Reshape Lifesciences.

Valuation and Earnings

This table compares Rockwell Medical and Reshape Lifesciences’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rockwell Medical $57.30 million 4.67 -$25.92 million ($0.51) -10.14
Reshape Lifesciences $1.29 million 6.80 -$33.81 million ($47.68) -0.07

Rockwell Medical has higher revenue and earnings than Reshape Lifesciences. Rockwell Medical is trading at a lower price-to-earnings ratio than Reshape Lifesciences, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

21.2% of Rockwell Medical shares are owned by institutional investors. 18.2% of Rockwell Medical shares are owned by insiders. Comparatively, 9.2% of Reshape Lifesciences shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Rockwell Medical and Reshape Lifesciences’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rockwell Medical -48.06% -76.49% -45.06%
Reshape Lifesciences -1,715.25% -69.19% -60.38%

Risk & Volatility

Rockwell Medical has a beta of 2.19, indicating that its stock price is 119% more volatile than the S&P 500. Comparatively, Reshape Lifesciences has a beta of 2.43, indicating that its stock price is 143% more volatile than the S&P 500.

Summary

Rockwell Medical beats Reshape Lifesciences on 9 of the 13 factors compared between the two stocks.

Rockwell Medical Company Profile

Rockwell Medical, Inc. operates as an integrated biopharmaceutical company targeting end-stage renal and chronic kidney diseases in the United States and internationally. The company's lead drug includes Triferic, an iron maintenance therapy that replaces the iron lost by patients during hemodialysis treatment. It also provides Calcitriol, a generic active vitamin D injection, which is indicated for the treatment of secondary hyperparathyroidism in dialysis patients. In addition, the company manufactures, sells, delivers, and distributes hemodialysis concentrates, such as CitraPure citric acid concentrate, Dri-Sate dry acid concentrate, RenalPure liquid acid concentrate, dry acid concentrate mixer, Renalpure powder bicarbonate concentrate, and SteriLyte liquid bicarbonate concentrate; and ancillary products, including blood tubings, fistula needles, specialized custom kits, dressings, cleaning agents, filtration salts, and other supplies used by hemodialysis providers. Its concentrated dialysate products are used to maintain human life by removing toxins and replacing critical nutrients in the dialysis patient's bloodstream. Rockwell Medical, Inc. sells its products directly, as well as through independent sales agents and distributors. The company's target customers include senior and operating management of dialysis companies, dialysis service providers, nephrologists, clinic administrators, nurses, medical directors, and technical and purchasing personnel. Rockwell Medical, Inc. was founded in 1995 and is based in Wixom, Michigan.

Reshape Lifesciences Company Profile

ReShape Lifesciences Inc., a medical device company, focuses on the design and development of devices that use neuroblocking technology to treat obesity, metabolic diseases, and other gastrointestinal disorders. Its proprietary neuroblocking technology, vBloc Therapy is designed to intermittently block the vagus nerve using electrical impulses. The company develops the vBloc System, which is used to limit the expansion of the stomach, control hunger sensations between meals, reduce the frequency and intensity of stomach contractions, and produce a feeling of early and prolonged fullness. It has collaboration with Mayo Clinic. The company was formerly known as EnteroMedics Inc. and changed its name to ReShape Lifesciences Inc. in October 2017. ReShape Lifesciences Inc. was founded in 2002 and is headquartered in St. Paul, Minnesota.

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