Sonoma Pharmaceuticals (NASDAQ:SNOA) and Spectral AI (NASDAQ:MDAI) Financial Contrast

Spectral AI (NASDAQ:MDAI) and Sonoma Pharmaceuticals (NASDAQ:SNOA) are both small-cap medical companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Spectral AI and Sonoma Pharmaceuticals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Spectral AI	0	0	3	1	3.25
Sonoma Pharmaceuticals	0	0	0	0	0.00

Spectral AI presently has a consensus price target of $4.50, indicating a potential upside of 150.00%. Given Spectral AI’s stronger consensus rating and higher probable upside, analysts clearly believe Spectral AI is more favorable than Sonoma Pharmaceuticals.

Institutional and Insider Ownership

67.1% of Spectral AI shares are owned by institutional investors. Comparatively, 2.0% of Sonoma Pharmaceuticals shares are owned by institutional investors. 56.7% of Spectral AI shares are owned by insiders. Comparatively, 3.9% of Sonoma Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Spectral AI and Sonoma Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Spectral AI	-40.78%	N/A	-77.87%
Sonoma Pharmaceuticals	-27.21%	-59.58%	-24.33%

Risk and Volatility

Spectral AI has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500. Comparatively, Sonoma Pharmaceuticals has a beta of 1.43, suggesting that its stock price is 43% more volatile than the S&P 500.

Earnings and Valuation

This table compares Spectral AI and Sonoma Pharmaceuticals”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Spectral AI	$18.06 million	1.85	-$20.85 million	($0.65)	-2.77
Sonoma Pharmaceuticals	$12.73 million	0.28	-$4.84 million	($4.99)	-0.54

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

Summary

Spectral AI beats Sonoma Pharmaceuticals on 10 of the 15 factors compared between the two stocks.

About Spectral AI

Spectral AI, Inc., an artificial intelligence (AI) company, focuses on developing predictive medical diagnostics in the United States. The company develops medical diagnostics for faster and accurate treatment decisions in wound care with applications involving patients with burns and diabetic foot ulcers. Its products include DeepView System, a predictive analytics platform integrated with the predictive AI-Burn, which combines AI algorithms and multispectral imaging (MSI) imaging for an assessment of wound healing potential and offers clinicians an objective and immediate assessment of a wound’s healing potential prior to treatment or other medical intervention; and DeepView SnapShot M, a handheld, portable, and wireless diagnostic tool, that provides a potential enhanced and expanded use for the government and emergency care, first responders, and potentially home health care professionals. The company is headquartered in Dallas, Texas.

About Sonoma Pharmaceuticals

Sonoma Pharmaceuticals, Inc., develops and produces stabilized hypochlorous acid (HOCl) products for wound care, animal health care, eye care, oral care, and dermatological conditions in the United States, Latin America, Europe, Asia, and internationally. The company offers Regenacyn, a prescription scar gel; Pediacyn, a pediatric dermatology and wound care product for over-the-counter (OTC) use; Epicyn, an Antimicrobial Facial Cleanser; Levicyn, an HOCl based prescription and OTC product to use and relieve skin irritations, lacerations, abrasions, and burns; Celacyn, a scar management gel; and SebuDerm to manage and relieve the burning, itching, erythema, scaling, and pain associated with seborrhea and seborrheic dermatitis. It also provides Gramaderm for the treatment of topical mild to moderate acne; Microcyn, a HOCl-based topical line of products designed to stimulate expedited healing by targeting a wide range of pathogens; Ocucyn eyelid and eyelash cleanser; Microdacyn60 oral care solution for the treatment of mouth and throat infections; and Podiacyn, a foot care product. In addition, the company offers MicrocynAH, an HOCl-based solution designed to relieve common symptoms of hot spots, scratches, skin rashes post-surgical sites, and irritated animal skin for healing; MicrocynVS, a veterinarian-strength animal care product used in vet clinics and animal hospitals; Nanocyn, a hospital-grade disinfectant; Acuicyn, an antimicrobial prescription solution for the treatment of blepharitis and the daily hygiene of eyelids and lashes; MucoClyns for the use in emergencies and safe to use on mucous membranes, cuts, abrasions, burns, and body surfaces; Endocyn root canal irrigation solutions; and Sinudox for nasal irrigation. The company was formerly known as Oculus Innovative Sciences, Inc. and changed its name to Sonoma Pharmaceuticals, Inc. in December 2016. Sonoma Pharmaceuticals, Inc. was incorporated in 1999 and is based in Boulder, Colorado.