NewLink Genetics (NASDAQ:NLNK) and Alkermes (ALKS) Critical Contrast

NewLink Genetics (NASDAQ: NLNK) and Alkermes (NASDAQ:ALKS) are both healthcare companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.

Profitability

This table compares NewLink Genetics and Alkermes’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NewLink Genetics -229.19% -63.39% -47.83%
Alkermes -20.12% -7.27% -5.05%

Insider & Institutional Ownership

52.6% of NewLink Genetics shares are owned by institutional investors. Comparatively, 99.2% of Alkermes shares are owned by institutional investors. 13.7% of NewLink Genetics shares are owned by company insiders. Comparatively, 5.3% of Alkermes shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares NewLink Genetics and Alkermes’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NewLink Genetics $35.77 million 8.89 -$85.15 million ($2.44) -3.52
Alkermes $745.69 million 12.11 -$208.44 million ($1.11) -52.89

NewLink Genetics has higher earnings, but lower revenue than Alkermes. Alkermes is trading at a lower price-to-earnings ratio than NewLink Genetics, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

NewLink Genetics has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, Alkermes has a beta of 2.13, meaning that its stock price is 113% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for NewLink Genetics and Alkermes, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NewLink Genetics 0 0 6 0 3.00
Alkermes 0 5 5 0 2.50

NewLink Genetics presently has a consensus price target of $25.67, suggesting a potential upside of 199.15%. Alkermes has a consensus price target of $64.50, suggesting a potential upside of 9.86%. Given NewLink Genetics’ stronger consensus rating and higher possible upside, equities research analysts clearly believe NewLink Genetics is more favorable than Alkermes.

Summary

Alkermes beats NewLink Genetics on 8 of the 14 factors compared between the two stocks.

NewLink Genetics Company Profile

NewLink Genetics Corporation is a clinical-stage immuno-oncology company focused on discovering, developing and commercializing immunotherapeutic products for the treatment of cancer. The Company’s portfolio includes biologic and small-molecule immunotherapy product candidates for a range of oncology indications. Its biologic product candidates are based on its HyperAcute Cellular Immunotherapy technology, which is designed to stimulate the human immune system to attack cancer cells. Its additional HyperAcute Cellular Immunotherapy product candidates in clinical development include tergenpumatucel-L and dorgenmeltucel-L for patients with advanced lung cancer and melanoma, respectively. Additionally, it has two small-molecule product candidates in clinical development: GDC-0919 and indoximod. These product candidates are indoleamine-2, 3-dioxygenase (IDO) pathway inhibitors and focus on breaking the immune system’s tolerance to cancer.

Alkermes Company Profile

Alkermes plc is a biopharmaceutical company. The Company is engaged in the researching, developing and commercializing pharmaceutical products that are designed to address medical needs of patients in therapeutic areas. The Company has a portfolio of marketed drug products and a clinical pipeline of products that address central nervous system (CNS) disorders, such as schizophrenia, depression, addiction and multiple sclerosis (MS). The Company’s products include ARISTADA, VIVITROL, INVEGA SUSTENNA, XEPLION, INVEGA TRINZA, TREVICTA, RISPERDAL CONSTA, AMPYRA, FAMPYRA, BYDUREON, Aripiprazole lauroxil, ALKS 5461, ALKS 3831, ALKS 8700, ALKS 6428, ALKS 4230 and ALKS 7119. The Company’s product platforms include injectable extended-release microsphere technology, LinkeRx technology, NanoCrystal technology and oral controlled release (OCR) technology. ARISTADA is an extended-release intramuscular injectable suspension for the treatment of schizophrenia.

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