Financial Survey: GenMark Diagnostics (GNMK) and Cerner Corporation (CERN)

GenMark Diagnostics (NASDAQ: GNMK) and Cerner Corporation (NASDAQ:CERN) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.

Profitability

This table compares GenMark Diagnostics and Cerner Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GenMark Diagnostics -116.76% -100.33% -57.22%
Cerner Corporation 13.37% 18.03% 12.89%

Valuation & Earnings

This table compares GenMark Diagnostics and Cerner Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
GenMark Diagnostics $49.27 million 5.30 -$50.60 million ($1.22) -3.91
Cerner Corporation $4.80 billion 4.53 $636.48 million $2.01 32.54

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

Volatility & Risk

GenMark Diagnostics has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Cerner Corporation has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Institutional & Insider Ownership

78.3% of Cerner Corporation shares are owned by institutional investors. 7.5% of GenMark Diagnostics shares are owned by insiders. Comparatively, 13.2% of Cerner Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings for GenMark Diagnostics and Cerner Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GenMark Diagnostics 0 1 5 0 2.83
Cerner Corporation 0 12 9 0 2.43

GenMark Diagnostics presently has a consensus price target of $12.20, suggesting a potential upside of 155.77%. Cerner Corporation has a consensus price target of $69.18, suggesting a potential upside of 5.77%. Given GenMark Diagnostics’ stronger consensus rating and higher possible upside, equities analysts clearly believe GenMark Diagnostics is more favorable than Cerner Corporation.

Summary

Cerner Corporation beats GenMark Diagnostics on 10 of the 13 factors compared between the two stocks.

GenMark Diagnostics Company Profile

GenMark Diagnostics, Inc. is a molecular diagnostics company. The Company is focused on developing and commercializing multiplex molecular tests that aid in the diagnosis of complex medical conditions. It develops and commercializes multiplex molecular tests based on its eSensor electrochemical detection technology. It offers four Food and Drug Administration (FDA)-cleared diagnostic tests which run on its XT-8 instrument; its Respiratory Viral Panel; its Cystic Fibrosis Genotyping Test; its Warfarin Sensitivity Test, and its Thrombophilia Risk Test. It also offers a Hepatitis C (HCV) genotyping test and associated custom manufactured reagents, as well as a 2C19 Genotyping Test, versions of which are available for use with its XT-8 instrument for research use only (RUO). Its XT-8 and ePlex test cartridges utilize the combination of distinct electrodes and multiple signal probes to detect dozens of target biomarkers from a single sample, thereby enabling highly multiplexed testing.

Cerner Corporation Company Profile

Cerner Corporation (Cerner) is a supplier of healthcare information technology (HCIT). The Company offers a range of intelligent solutions and services that support the clinical, financial and operational needs of organizations of all sizes. The Company’s segments include Domestic and Global. The Domestic segment includes revenue contributions and expenditures associated with business activity in the United States. The Global segment includes revenue contributions and expenditures linked to business activity in Aruba, Australia, Austria, the Bahamas, Belgium, Bermuda, Brazil, Canada, Cayman Islands, Chile, Denmark, Egypt, England, Finland, France, Germany, Guam, India, Ireland, Kuwait, Luxembourg, Malaysia, Mexico, the Netherlands, Norway, Portugal, Qatar, Romania, Saudi Arabia, Singapore, Slovakia, Spain, Sweden, Switzerland and the United Arab Emirates. The Company’s solutions are offered on the unified Cerner Millennium architecture and on the HealtheIntent cloud-based platform.

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