Analyzing NovoCure (NASDAQ:NVCR) and Kewaunee Scientific (NASDAQ:KEQU)

Kewaunee Scientific (NASDAQ:KEQU) and NovoCure (NASDAQ:NVCR) are both small-cap healthcare companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Volatility and Risk

Kewaunee Scientific has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500. Comparatively, NovoCure has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Kewaunee Scientific and NovoCure, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kewaunee Scientific	0	1	0	0	2.00
NovoCure	1	4	2	0	2.14

NovoCure has a consensus price target of $21.20, indicating a potential upside of 44.86%. Given NovoCure’s stronger consensus rating and higher probable upside, analysts clearly believe NovoCure is more favorable than Kewaunee Scientific.

Earnings & Valuation

This table compares Kewaunee Scientific and NovoCure”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kewaunee Scientific	$282.00 million	0.35	$9.62 million	$2.76	12.22
NovoCure	$655.35 million	2.60	-$136.23 million	($1.30)	-11.26

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

Insider and Institutional Ownership

32.7% of Kewaunee Scientific shares are owned by institutional investors. Comparatively, 84.6% of NovoCure shares are owned by institutional investors. 14.1% of Kewaunee Scientific shares are owned by company insiders. Comparatively, 6.6% of NovoCure shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Kewaunee Scientific and NovoCure’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kewaunee Scientific	2.97%	11.61%	4.82%
NovoCure	-21.25%	-44.00%	-15.85%

About Kewaunee Scientific

Kewaunee Scientific Corporation designs, manufactures, and installs laboratory, healthcare, and technical furniture and infrastructure products. The company operates through two segments, Domestic and International. Its products include steel and wood casework, fume hoods, adaptable modular systems, moveable workstations, stand-alone benches, biological safety cabinets, and epoxy resin work surfaces and sinks. The company's laboratory products are used in chemistry, physics, biology, and other general science laboratories in the pharmaceutical, biotechnology, industrial, chemical, commercial, educational, government, and health care markets; and technical products are used in facilities manufacturing computers and light electronics and by users of computer and networking furniture. It sells its products primarily through dealers, its subidiaries, and a national distributor. The company was founded in 1906 and is headquartered in Statesville, North Carolina.

About NovoCure

NovoCure Limited, an oncology company, engages in the development, manufacture, and commercialization of tumor treating fields (TTFields) devices for the treatment of solid tumor cancers in the United States, Germany, Japan, Greater China, and internationally. The company’s TTFields devices include Optune Gio and Optune Lua. It also has ongoing clinical trials investigating TTFields in brain metastases, gastric cancer, glioblastoma, liver cancer, non-small cell lung cancer, pancreatic cancer, and ovarian cancer. NovoCure Limited was incorporated in 2000 and is headquartered in Saint Helier, Jersey.