Neoleukin Therapeutics (NASDAQ:NLTX) & Zymeworks (NASDAQ:ZYME) Financial Review

Neoleukin Therapeutics (NASDAQ:NLTX) and Zymeworks (NASDAQ:ZYME) are both small-cap medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, earnings, analyst recommendations, valuation and risk.

Valuation and Earnings

This table compares Neoleukin Therapeutics and Zymeworks”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Neoleukin Therapeutics	N/A	N/A	-$57.56 million	($3.11)	-6.65
Zymeworks	$105.96 million	17.96	-$81.13 million	($1.08)	-23.89

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

Analyst Recommendations

This is a summary of recent recommendations for Neoleukin Therapeutics and Zymeworks, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Neoleukin Therapeutics	0	0	0	0	0.00
Zymeworks	1	1	9	2	2.92

Zymeworks has a consensus target price of $37.89, indicating a potential upside of 46.86%. Given Zymeworks’ stronger consensus rating and higher possible upside, analysts clearly believe Zymeworks is more favorable than Neoleukin Therapeutics.

Risk and Volatility

Neoleukin Therapeutics has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500. Comparatively, Zymeworks has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.

Profitability

This table compares Neoleukin Therapeutics and Zymeworks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Neoleukin Therapeutics	N/A	-37.22%	-30.91%
Zymeworks	-76.56%	-26.00%	-20.57%

Institutional and Insider Ownership

52.4% of Neoleukin Therapeutics shares are held by institutional investors. Comparatively, 92.9% of Zymeworks shares are held by institutional investors. 1.6% of Neoleukin Therapeutics shares are held by insiders. Comparatively, 33.5% of Zymeworks shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Zymeworks beats Neoleukin Therapeutics on 11 of the 14 factors compared between the two stocks.

About Neoleukin Therapeutics

Neoleukin Therapeutics, Inc., a biopharmaceutical company, develops immunotherapies for cancer, inflammation, and autoimmunity disorders using protein design technology. The company's lead product candidate is NL-201, a de novo protein designed to mimic the therapeutic activity of the cytokines interleukin (IL)-2/IL-15 for the treatment of various types of cancer, including renal cell carcinoma and melanoma. The company was formerly known as Aquinox Pharmaceuticals, Inc. and changed its name to Neoleukin Therapeutics, Inc. in August 2019. Neoleukin Therapeutics, Inc. was founded in 2003 and is headquartered in Seattle, Washington.

About Zymeworks

Zymeworks Inc., a clinical-stage biopharmaceutical company, discovers, develops, and commercializes biotherapeutics for the treatment of cancer. The company’s lead product candidates include zanidatamab, a novel bispecific antibody that is in Phase 1 and Phase 2 clinical trials for the treatment of biliary tract, gastroesophageal adenocarcinomas, and breast cancer; and ZW49, a biparatopic anti- human epidermal growth factor receptor 2 (HER2) antibody-drug conjugate that is in Phase 1 clinical trial for the treatment of advanced or metastatic HER2-expressing tumors. The company has strategic partnerships with Merck Sharp & Dohme Research Ltd.; Eli Lilly and Company; Bristol-Myers Squibb company; GlaxoSmithKline Intellectual Property Development Ltd.; Daiichi Sankyo Co., Ltd.; Janssen Biotech, Inc.; and BeiGene, Ltd. It also has licensing and research collaboration with LEO Pharma A/S to discover and develop bispecific antibodies; and Iconic Therapeutics, Inc. Zymeworks Inc. was founded in 2003 and is headquartered in Vancouver, Canada.