Regenxbio (NASDAQ: RGNX) and Verastem (NASDAQ:VSTM) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, profitability, earnings and analyst recommendations.
This table compares Regenxbio and Verastem’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
68.7% of Regenxbio shares are owned by institutional investors. Comparatively, 28.7% of Verastem shares are owned by institutional investors. 17.0% of Regenxbio shares are owned by company insiders. Comparatively, 6.5% of Verastem shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a breakdown of current ratings for Regenxbio and Verastem, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Regenxbio currently has a consensus target price of $43.17, indicating a potential upside of 41.76%. Verastem has a consensus target price of $10.64, indicating a potential upside of 248.95%. Given Verastem’s higher probable upside, analysts plainly believe Verastem is more favorable than Regenxbio.
Volatility and Risk
Regenxbio has a beta of -0.88, meaning that its share price is 188% less volatile than the S&P 500. Comparatively, Verastem has a beta of 2.19, meaning that its share price is 119% more volatile than the S&P 500.
Valuation and Earnings
This table compares Regenxbio and Verastem’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Regenxbio||$4.59 million||206.65||-$62.96 million||($2.70)||-11.28|
Verastem has lower revenue, but higher earnings than Regenxbio. Regenxbio is trading at a lower price-to-earnings ratio than Verastem, indicating that it is currently the more affordable of the two stocks.
Verastem beats Regenxbio on 7 of the 13 factors compared between the two stocks.
Regenxbio Company Profile
REGENXBIO Inc. is a clinical-stage biotechnology company. The Company’s gene therapy product candidates are designed to deliver genes to cells to address genetic defects or to enable cells in the body to produce therapeutic proteins or antibodies that are intended to impact disease. The Company develops products candidates across the therapeutic areas of metabolic, neurodegenerative and retinal diseases. Its product candidate, RGX-314, is meant for the treatment of wet age-related macular degeneration (wet AMD). Its product candidate, RGX-501, is meant for the treatment of homozygous familial hypercholesterolemia (HoFH). It is also developing product candidates, such as RGX-111 and RGX-121, to address the neurological symptoms of two severe genetic lysosomal storage diseases, Mucopolysaccharidosis Type I (MPS I) and Mucopolysaccharidosis Type II (MPS II), respectively. Its product candidates utilize viral vectors from its gene delivery platform, NAV Technology Platform.
Verastem Company Profile
Verastem, Inc. is a biopharmaceutical company. The Company is focused on discovering and developing drugs to improve outcomes for patients with cancer. The Company operates in the segment of developing drugs for the treatment of cancer. The Company’s advanced product candidates are VS 6063, VS 4718 and VS 5584. The Company’s programs target the Focal Adhesion Kinase (FAK) and the PI3K/mTOR signaling pathways. FAK is a non-receptor tyrosine kinase encoded by the PTK-2 gene that is involved in cellular adhesion and, in cancer, metastatic capability. The Company’s VS-6063 (defactinib) and VS 4718 are orally available small molecule compounds designed to inhibit FAK signaling. The Company’s VS-5584 is an orally available small molecule that inhibits both mTORC1/2 and PI3K signaling. The Company is engaged in running clinical trials in cancers where there are limited treatment options, including lung, ovarian, lymphoma, pancreatic and other advanced cancers.
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