Analyzing Acasti Pharma (NASDAQ:ACST) and ADC Therapeutics (NYSE:ADCT)

ADC Therapeutics (NYSE:ADCT) and Acasti Pharma (NASDAQ:ACST) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Profitability

This table compares ADC Therapeutics and Acasti Pharma’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ADC Therapeutics	-344.15%	-1,313.37%	-53.29%
Acasti Pharma	N/A	-13.18%	-11.32%

Insider & Institutional Ownership

41.1% of ADC Therapeutics shares are owned by institutional investors. Comparatively, 6.1% of Acasti Pharma shares are owned by institutional investors. 35.4% of ADC Therapeutics shares are owned by company insiders. Comparatively, 13.5% of Acasti Pharma shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk and Volatility

ADC Therapeutics has a beta of 1.69, suggesting that its share price is 69% more volatile than the S&P 500. Comparatively, Acasti Pharma has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for ADC Therapeutics and Acasti Pharma, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ADC Therapeutics	0	2	3	0	2.60
Acasti Pharma	0	0	1	0	3.00

ADC Therapeutics currently has a consensus price target of $7.25, suggesting a potential upside of 58.64%. Acasti Pharma has a consensus price target of $6.00, suggesting a potential upside of 117.39%. Given Acasti Pharma’s stronger consensus rating and higher probable upside, analysts clearly believe Acasti Pharma is more favorable than ADC Therapeutics.

Valuation & Earnings

This table compares ADC Therapeutics and Acasti Pharma’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ADC Therapeutics	$69.56 million	5.44	-$240.05 million	($2.93)	-1.56
Acasti Pharma	N/A	N/A	-$42.43 million	($5.08)	-0.54

Acasti Pharma has lower revenue, but higher earnings than ADC Therapeutics. ADC Therapeutics is trading at a lower price-to-earnings ratio than Acasti Pharma, indicating that it is currently the more affordable of the two stocks.

Summary

Acasti Pharma beats ADC Therapeutics on 7 of the 13 factors compared between the two stocks.

About ADC Therapeutics

ADC Therapeutics SA focuses on advancing its proprietary antibody drug conjugate (ADC) technology platform to transform the treatment paradigm for patients with hematologic malignancies and solid tumors. Its flagship product is ZYNLONTA, a CD19-directed ADC, received accelerated approval from the U.S. Food and Drug Administration and conditional approval from the European Commission for the treatment of relapsed or refractory diffuse large B-cell lymphoma (DLBCL) after two or more lines of systemic therapy. The company is also seeking to continue expanding ZYNLONTA into international markets and into earlier lines of DLBCL and indolent lymphomas, including follicular lymphoma (FL) and marginal zone lymphoma (MZL) as a single agent and in combination through its LOTIS-5 confirmatory Phase 3 clinical trial and LOTIS-7 Phase 1b clinical trial, as well as through investigator-initiated trials (IITs). In addition, it is investigating a CD-22 targeted compound, ADCT-602 that is in a Phase 1/2 investigator-initiated study in relapsed or refractory B-cell acute lymphoblastic leukemia. Further, its clinical-stage pipeline consists of ADCT-601 (mipasetamab uzoptirine) targeting AXL as a single agent and/or in combination in sarcoma, pancreatic, and NSCLC, as well as pre-clinical stage pipeline includes a portfolio of next generation investigational ADCs targeting Claudin-6, NaPi2b, PSMA, and other undisclosed targets. The company was incorporated in 2011 and is headquartered in Epalinges, Switzerland.

About Acasti Pharma

Acasti Pharma Inc. engages in the development and commercialization of pharmaceutical products for rare and orphan diseases in Canada. The company's lead product candidate is the GTX-104, an intravenous infusion to treat subarachnoid hemorrhage. It also develops GTX-102, an oral mucosal spray for the treatment of ataxia-telangiectasia; and GTX-101, a topical bioadhesive film-forming bupivacaine spray for postherpetic neuralgia. The company was incorporated in 2002 and is headquartered in Laval, Canada.