Financial Analysis: Aethlon Medical (NASDAQ:AEMD) versus AtriCure (NASDAQ:ATRC)

AtriCure (NASDAQ:ATRC) and Aethlon Medical (NASDAQ:AEMD) are both small-cap medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.

Profitability

This table compares AtriCure and Aethlon Medical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AtriCure	-8.70%	-8.12%	-6.21%
Aethlon Medical	N/A	-160.36%	-115.74%

Earnings and Valuation

This table compares AtriCure and Aethlon Medical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AtriCure	$399.24 million	3.89	-$30.44 million	($0.83)	-38.37
Aethlon Medical	$570,000.00	8.76	-$12.21 million	($2.82)	-0.13

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

Risk & Volatility

AtriCure has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500. Comparatively, Aethlon Medical has a beta of 1.79, suggesting that its share price is 79% more volatile than the S&P 500.

Insider and Institutional Ownership

99.1% of AtriCure shares are owned by institutional investors. Comparatively, 2.0% of Aethlon Medical shares are owned by institutional investors. 3.2% of AtriCure shares are owned by insiders. Comparatively, 1.1% of Aethlon Medical shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for AtriCure and Aethlon Medical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AtriCure	0	0	8	0	3.00
Aethlon Medical	0	0	1	0	3.00

AtriCure currently has a consensus price target of $42.00, suggesting a potential upside of 31.87%. Aethlon Medical has a consensus price target of $7.00, suggesting a potential upside of 1,858.04%. Given Aethlon Medical’s higher probable upside, analysts plainly believe Aethlon Medical is more favorable than AtriCure.

Summary

AtriCure beats Aethlon Medical on 7 of the 12 factors compared between the two stocks.

About AtriCure

AtriCure, Inc. develops, manufactures, and sells devices for surgical ablation of cardiac tissue, exclusion of the left atrial appendage, and temporarily blocking pain by ablating peripheral nerves to medical centers in the United States, Europe, the Asia-Pacific, and internationally. The company offers Isolator Synergy Clamps, single-use disposable radio frequency products; multifunctional pens and linear ablation devices, such as the MAX Pen device that enables surgeons to evaluate cardiac arrhythmias, perform temporary cardiac pacing, sensing, and stimulation, and ablate cardiac tissue with the same device; and the Coolrail device, which enables users to make longer linear lines of ablation. It also provides cryoICE Cryoablation System that enables the user to make linear ablations of varied lengths; EPi-Sense Systems, a single-use disposable device used for the treatment of symptomatic, drug-refractory, and long-standing persistent atrial fibrillation; cryoSPHERE probe, which provides temporary pain relief by applying cryothermic energy to targeted intercoastal peripheral nerves in the ribcage; AtriClip System, an implantable device coupled to a single-use disposable applier; and LARIAT System, a suture-based solution for soft-tissue closure. In addition, the company sells Lumitip dissectors to separate tissues to provide access to key anatomical structures that are targeted for ablation; Glidepath guides for placement of clamps; Subtle Cannula's to support access for EPi-Sense catheters; and various reusable cardiac surgery instruments. It markets and sells its products through independent distributors and direct sales personnel. The company was incorporated in 2000 and is headquartered in Mason, Ohio.

About Aethlon Medical

Aethlon Medical, Inc., a medical therapeutic company, focuses on developing products to treat cancer and life-threatening infectious diseases in the United States. It develops Hemopurifier, a clinical-stage immunotherapeutic device that removes tumor-derived exosomes and life-threatening viruses and use in organ transplantation. The company was incorporated in 1999 and is based in San Diego, California.