Critical Survey: Talkspace (NASDAQ:TALK) & HeartSciences (NASDAQ:HSCS)

Talkspace (NASDAQ:TALK) and HeartSciences (NASDAQ:HSCS) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitability and dividends.

Profitability

This table compares Talkspace and HeartSciences’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Talkspace	1.41%	2.48%	2.11%
HeartSciences	N/A	-293.60%	-135.39%

Institutional & Insider Ownership

57.4% of Talkspace shares are owned by institutional investors. Comparatively, 17.2% of HeartSciences shares are owned by institutional investors. 23.5% of Talkspace shares are owned by insiders. Comparatively, 1.8% of HeartSciences shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Talkspace and HeartSciences”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Talkspace	$187.59 million	2.42	$1.15 million	$0.02	135.50
HeartSciences	N/A	N/A	-$8.77 million	($9.36)	-0.36

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

Analyst Ratings

This is a summary of recent recommendations for Talkspace and HeartSciences, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Talkspace	0	2	3	2	3.00
HeartSciences	0	0	2	0	3.00

Talkspace presently has a consensus price target of $4.50, indicating a potential upside of 66.05%. HeartSciences has a consensus price target of $13.00, indicating a potential upside of 284.62%. Given HeartSciences’ higher probable upside, analysts clearly believe HeartSciences is more favorable than Talkspace.

Risk and Volatility

Talkspace has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500. Comparatively, HeartSciences has a beta of 2.56, indicating that its stock price is 156% more volatile than the S&P 500.

Summary

Talkspace beats HeartSciences on 11 of the 13 factors compared between the two stocks.

About Talkspace

Talkspace, Inc. operates as a virtual behavioral healthcare company in the United States. The company offers psychotherapy and psychiatry services through its platform to individuals, enterprises, and health plans and employee assistance programs. It provides text, audio, and video-based psychotherapy from licensed therapists. The company offers Talkspace Employee Assistance Program (EAP) and Talkspace Behavioral Health plan (BH) that provides online therapy to members through BH and EAP offerings; and Talkspace for Business for members to access its platform services on a benefit plan paid by the enterprise. It serves its platform through third-party platforms or marketplace, such as Apple App Store and Google Play App Store. Talkspace, Inc. was founded in 2012 and is headquartered in New York, New York.

About HeartSciences

Heart Test Laboratories, Inc., a medical technology company, provides cardiovascular diagnostic devices. The company offers MyoVista wavECG, a resting 12-lead electrocardiograph (ECG) to provide diagnostic information related to cardiac dysfunction, as well as conventional ECG information. It serves clinics, doctor's offices, urgent care centers, and hospitals. The company was incorporated in 2007 and is headquartered in Southlake, Texas.