Compass Diversified (NYSE:CODI – Get Free Report) and KindlyMD (NASDAQ:NAKA – Get Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, dividends, analyst recommendations and valuation.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Compass Diversified and KindlyMD, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Compass Diversified | 1 | 2 | 3 | 0 | 2.33 |
| KindlyMD | 1 | 1 | 3 | 0 | 2.40 |
Compass Diversified currently has a consensus price target of $16.50, suggesting a potential upside of 50.40%. KindlyMD has a consensus price target of $20.00, suggesting a potential upside of 114.13%. Given KindlyMD’s stronger consensus rating and higher probable upside, analysts plainly believe KindlyMD is more favorable than Compass Diversified.
Risk & Volatility
Valuation and Earnings
This table compares Compass Diversified and KindlyMD”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Compass Diversified | $1.87 billion | 0.44 | -$226.41 million | ($2.17) | -5.06 |
| KindlyMD | $1.82 million | 91.86 | -$52.23 million | ($35.85) | -0.26 |
KindlyMD has lower revenue, but higher earnings than Compass Diversified. Compass Diversified is trading at a lower price-to-earnings ratio than KindlyMD, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
72.7% of Compass Diversified shares are held by institutional investors. 1.6% of Compass Diversified shares are held by company insiders. Comparatively, 24.5% of KindlyMD shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares Compass Diversified and KindlyMD’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Compass Diversified | -5.38% | -10.36% | -0.10% |
| KindlyMD | -1,067.93% | -63.45% | -41.04% |
Summary
KindlyMD beats Compass Diversified on 7 of the 13 factors compared between the two stocks.
About Compass Diversified
Compass Diversified is a private equity firm specializing in add on acquisitions, buyouts, industry consolidation, recapitalization, late stage and middle market investments. It seeks to invest in niche industrial or branded consumer companies, manufacturing, distribution, consumer products, business services sector, healthcare, safety & security, electronic components, food and foodservice. The firm prefers to invest in companies based in North America. It seeks to invest between $100 million and $800 million in companies with an EBITDA between $15 million to $80 million. It seeks to acquire controlling ownership interests in its portfolio companies and can make additional platform acquisitions. The firm prefer to have majority stake in companies. The firm invests through its balance sheet and typically holds investments between five to seven years. Compass Diversified was founded in 2006 and is based in Westport, Connecticut with an additional office in Costa Mesa, California.
About KindlyMD
Kindly MD, Inc. (“KindlyMD” or “Kindly”) is a Utah company formed in 2019. KindlyMD is a healthcare data company, focused on holistic pain management and reducing the impact of the opioid epidemic. KindlyMD offers direct health care to patients integrating prescription medicine and behavioral health services to reduce opioid use in the chronic pain patient population. Kindly believes these methods will help prevent and reduce addiction and dependency on opiates. Our specialty outpatient clinical services are offered on a fee-for-service basis. The Company offers evaluation and management, including, but not limited to chronic pain, functional medicine, cognitive behavioral therapy, trauma and addiction therapy, recovery support services, overdose education efforts, peer support, limited urgent care, preventative medicine, medically managed weight loss, and hormone therapy. Through its focus on an embedded model of prescriber and therapist teams, KindlyMD develops patient-specific care programs with a specific mission to reduce opioid use in the patient population while successfully treating patients with effective and evidence-based non-opioid alternatives in close conjunction with behavioral therapy. Beyond its treatment of patients, KindlyMD collects data focused on why and how patients turn to alternative treatments to reduce prescription medication use and addiction. The Company captures all relevant datapoints to assist and appropriately treat each individual patient. This also results in valuable data for the Company and the Company’s investors. We strive to become a source for evidence-based guidelines, data, treatment models, and education in the fight against the opioid crisis in America. Business Revenue Streams We currently earn revenue through (i) patient care services related to medical evaluation and treatment and (ii) product retail sales. Our forecasted plan is to operate across various revenue streams: (i) medical evaluation and treatment visits reimbursed by Medicare, Medicaid, and commercial insurance payers as well as self-pay services, (ii) data collection and research, (iii) education partnerships, (iv) service affiliate agreements, and (v) retail sales. Our principal executive offices are located at 5097 S 900 E, Suite 100 Salt Lake City, UT.
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