Biocept (BIOC) vs. CareDx (CDNA) Critical Review

Biocept (NASDAQ: BIOC) and CareDx (NASDAQ:CDNA) are both small-cap medical companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, profitability and valuation.

Insider and Institutional Ownership

8.7% of Biocept shares are held by institutional investors. Comparatively, 51.5% of CareDx shares are held by institutional investors. 7.7% of Biocept shares are held by insiders. Comparatively, 5.4% of CareDx shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Biocept and CareDx’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Biocept $5.07 million 3.36 -$21.61 million ($0.79) -0.32
CareDx $48.32 million 5.65 -$55.46 million ($0.77) -12.19

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

Profitability

This table compares Biocept and CareDx’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Biocept -426.48% -374.92% -169.29%
CareDx -114.79% -349.65% -22.88%

Analyst Ratings

This is a breakdown of current ratings and price targets for Biocept and CareDx, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Biocept 0 0 2 0 3.00
CareDx 0 0 4 0 3.00

Biocept presently has a consensus target price of $1.25, suggesting a potential upside of 400.00%. CareDx has a consensus target price of $8.88, suggesting a potential downside of 5.48%. Given Biocept’s higher possible upside, analysts plainly believe Biocept is more favorable than CareDx.

Risk & Volatility

Biocept has a beta of 1.77, meaning that its stock price is 77% more volatile than the S&P 500. Comparatively, CareDx has a beta of 0.35, meaning that its stock price is 65% less volatile than the S&P 500.

Summary

CareDx beats Biocept on 8 of the 13 factors compared between the two stocks.

Biocept Company Profile

Biocept, Inc., an early stage molecular oncology diagnostics company, develops and commercializes proprietary circulating tumor cell (CTC) and circulating tumor DNA assays utilizing a standard blood sample. The company's cancer assays provide information to oncologists and other physicians that enable them to select personalized treatment for their patients who have been diagnosed with cancer based on molecular drivers. It offers assays for solid tumor indications, such as breast cancer, non-small cell lung cancer, small cell lung cancer, gastric cancer, colorectal cancer, prostate cancer, and melanoma. The company sells its cancer diagnostic assays directly to oncologists and other physicians at private and group practices, hospitals, and cancer centers in the United States, as well as markets its clinical trial and research services to pharmaceutical and biopharmaceutical companies, and clinical research organizations. Biocept, Inc. was founded in 1997 and is headquartered in San Diego, California.

CareDx Company Profile

CareDx, Inc. is a molecular diagnostics company. The Company is focused on the discovery, development and commercialization of clinically differentiated diagnostic surveillance solutions for transplant patients. The Company’s commercialized testing solution, the AlloMap heart transplant molecular test (AlloMap), is a gene expression test that helps clinicians monitor and identify heart transplant recipients with stable graft function having a low probability of moderate/severe acute cellular rejection. Its products under development for transplant monitoring include AlloSure, a development-stage transplant surveillance solution, which applies next generation sequencing to detect and quantitate genetic differences between donor-derived cell-free deoxyribonucleic acid (dd-cfDNA) in the blood stream emanating from the donor heart. It offers the AlloMap Score Variability service, which provides complementary information to help personalize long-term care of heart transplant recipients.

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