Aduro BioTech (NASDAQ:ADRO) and Gemphire Therapeutics (NASDAQ:GEMP) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, profitability, analyst recommendations, earnings and valuation.
This table compares Aduro BioTech and Gemphire Therapeutics’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings for Aduro BioTech and Gemphire Therapeutics, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Aduro BioTech currently has a consensus price target of $9.86, indicating a potential upside of 230.87%. Gemphire Therapeutics has a consensus price target of $20.20, indicating a potential upside of 2,169.66%. Given Gemphire Therapeutics’ higher possible upside, analysts plainly believe Gemphire Therapeutics is more favorable than Aduro BioTech.
Volatility & Risk
Aduro BioTech has a beta of 1.87, suggesting that its stock price is 87% more volatile than the S&P 500. Comparatively, Gemphire Therapeutics has a beta of 2.6, suggesting that its stock price is 160% more volatile than the S&P 500.
Institutional & Insider Ownership
48.3% of Aduro BioTech shares are owned by institutional investors. Comparatively, 29.2% of Gemphire Therapeutics shares are owned by institutional investors. 5.0% of Aduro BioTech shares are owned by insiders. Comparatively, 22.7% of Gemphire Therapeutics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Aduro BioTech and Gemphire Therapeutics’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Aduro BioTech||$17.24 million||13.72||-$91.86 million||($1.42)||-2.10|
|Gemphire Therapeutics||N/A||N/A||-$33.41 million||($3.23)||-0.28|
Gemphire Therapeutics has lower revenue, but higher earnings than Aduro BioTech. Aduro BioTech is trading at a lower price-to-earnings ratio than Gemphire Therapeutics, indicating that it is currently the more affordable of the two stocks.
Aduro BioTech beats Gemphire Therapeutics on 7 of the 13 factors compared between the two stocks.
About Aduro BioTech
Aduro BioTech, Inc., an immunotherapy company, focuses on the discovery, development, and commercialization of therapies that transform the treatment of challenging diseases. The company is developing ADU-S100, which is in Phase I monotherapy study, as well as in Phase 1b combination study with an anti-PD1 immune checkpoint inhibitor; ADU-214 that is in Phase I clinical trials for the treatment of lung cancer; and ADU-741 for the treatment of prostate cancer. Its products pipeline also comprises BION-1301, a B-select monoclonal antibody novel therapy for multiple myeloma; A PRoliferation-Inducing Ligand for the treatment of multiple myeloma, chronic lymphocytic leukemia, and colorectal carcinoma; CD27, a co-stimulatory receptor for the treatment of cancer; and CTLA-4 for the treatment of advanced melanoma and other cancers. The company's pLADD program is based on proprietary attenuated strains of Listeria that have been engineered to express tumor neo antigens that are specific to an individual patient's tumor. It has collaboration agreements with Novartis Pharmaceuticals Corporation, Janssen Biotech, Inc, and Merck. The company was formerly known as Oncologic, Inc. and changed its name to Aduro BioTech, Inc. in June 2008. Aduro BioTech, Inc. was founded in 2000 and is based in Berkeley, California.
About Gemphire Therapeutics
Gemphire Therapeutics Inc., a clinical-stage biopharmaceutical company, focuses on developing and commercializing therapies for the treatment of dyslipidemia and non-alcoholic steatohepatitis (NASH). It is developing gemcabene, a novel, once-daily, oral therapy, for high risk cardiovascular patients who are unable to achieve normal levels of LDL-C or triglycerides with currently approved therapies, primarily statin therapy, and for those patients who present with NASH. The company was founded in 2008 and is headquartered in Livonia, Michigan.
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