Flamel Technologies (NASDAQ: AVDL) and Acura Pharmaceuticals (NASDAQ:ACUR) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitabiliy and analyst recommendations.

Valuation and Earnings

This table compares Flamel Technologies and Acura Pharmaceuticals’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Flamel Technologies $166.54 million 2.51 $58.40 million ($0.32) -31.59
Acura Pharmaceuticals $6.96 million N/A -$2.50 million ($0.83) -0.64

Flamel Technologies has higher revenue and earnings than Acura Pharmaceuticals. Flamel Technologies is trading at a lower price-to-earnings ratio than Acura Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Flamel Technologies and Acura Pharmaceuticals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Flamel Technologies 0 0 2 0 3.00
Acura Pharmaceuticals 0 0 2 0 3.00

Flamel Technologies presently has a consensus target price of $16.00, suggesting a potential upside of 58.26%. Acura Pharmaceuticals has a consensus target price of $8.00, suggesting a potential upside of 1,409.43%. Given Acura Pharmaceuticals’ higher possible upside, analysts clearly believe Acura Pharmaceuticals is more favorable than Flamel Technologies.

Institutional and Insider Ownership

70.4% of Flamel Technologies shares are held by institutional investors. Comparatively, 31.2% of Acura Pharmaceuticals shares are held by institutional investors. 5.1% of Flamel Technologies shares are held by insiders. Comparatively, 7.4% of Acura Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Flamel Technologies has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500. Comparatively, Acura Pharmaceuticals has a beta of 2.12, meaning that its stock price is 112% more volatile than the S&P 500.

Profitability

This table compares Flamel Technologies and Acura Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Flamel Technologies -7.28% 14.49% 2.74%
Acura Pharmaceuticals 14.91% 112.19% 19.04%

Summary

Acura Pharmaceuticals beats Flamel Technologies on 6 of the 10 factors compared between the two stocks.

Flamel Technologies Company Profile

Flamel Technologies S.A. is a specialty pharmaceutical company. The Company is engaged in the development and commercialization of pharmaceutical products, including controlled-release therapeutic products based on its polymer based technology. The Company has a balanced business model consisting of an Unapproved Marketed Drugs (UMDs) business with over two approved products in the United States, Bloxiverz (neostigmine methylsulfate injection) and Vazculep (phenylephrine hydrochloride injection) that are marketed; a branded pediatric business, and a branded business, focusing on the development of products utilizing Flamel’s drug delivery platforms. The Company owns and develops drug delivery platforms, including Micropump, LiquiTime, Trigger Lock and Medusa. The Company has two direct operating subsidiaries: Flamel US Holdings, Inc. and Flamel Irish Holdings, Ltd.

Acura Pharmaceuticals Company Profile

Acura Pharmaceuticals, Inc. is a pharmaceutical company. The Company is engaged in the research, development and commercialization of technologies and products intended to address medication abuse and misuse. The Company has discovered and developed three platform technologies, which can be used to develop multiple products. The Company’s Oxaydo Tablets (oxycodone HCl, CII), which utilizes the Aversion Technology, is an approved and immediate-release (IR) oxycodone product in the United States. The Company’s Impede technology products include Nexafed and Nexafed Sinus Pressure + Pain. Its third deterrent technology is Limitx, which is designed to retard the release of active drug ingredients when too many tablets are accidently or purposefully ingested. The Company’s Aversion and Limitx technologies are intended to address methods associated with opioid and its Impede technology is directed at the extraction and conversion of pseudoephedrine into methamphetamine.

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