Retrophin (NASDAQ: RTRX) and Atara Biotherapeutics (NASDAQ:ATRA) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.

Volatility and Risk

Retrophin has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500. Comparatively, Atara Biotherapeutics has a beta of 1.38, suggesting that its stock price is 38% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Retrophin and Atara Biotherapeutics, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Retrophin 0 0 3 0 3.00
Atara Biotherapeutics 1 0 3 0 2.50

Retrophin currently has a consensus price target of $36.50, indicating a potential upside of 57.40%. Atara Biotherapeutics has a consensus price target of $29.00, indicating a potential upside of 87.10%. Given Atara Biotherapeutics’ higher possible upside, analysts plainly believe Atara Biotherapeutics is more favorable than Retrophin.

Institutional & Insider Ownership

83.0% of Atara Biotherapeutics shares are held by institutional investors. 2.4% of Retrophin shares are held by company insiders. Comparatively, 16.1% of Atara Biotherapeutics shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Retrophin and Atara Biotherapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Retrophin -48.74% -7.31% -4.27%
Atara Biotherapeutics N/A -39.54% -37.40%

Valuation & Earnings

This table compares Retrophin and Atara Biotherapeutics’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Retrophin $143.69 million 6.19 -$24.86 million ($2.05) -11.31
Atara Biotherapeutics N/A N/A -$98.03 million ($3.33) -4.65

Retrophin has higher revenue and earnings than Atara Biotherapeutics. Retrophin is trading at a lower price-to-earnings ratio than Atara Biotherapeutics, indicating that it is currently the more affordable of the two stocks.

Summary

Retrophin beats Atara Biotherapeutics on 6 of the 11 factors compared between the two stocks.

Retrophin Company Profile

Retrophin, Inc. is a biopharmaceutical company. The Company is focused on the development, acquisition and commercialization of therapies for the treatment of serious, catastrophic or rare diseases. The Company sells three products, including Chenodal (chenodeoxycholic acid), Cholbam (cholic acid) and Thiola (tiopronin). Its Chenodal is approved in the United States for the treatment of patients suffering from gallstones in whom surgery poses an unacceptable health risk due to disease or advanced age. Chenodal has also been care for cerebrotendinous xanthomatosis (CTX) patients. Its Cholbam is approved in the United States for the treatment of bile acid synthesis disorders due to single enzyme defects and is further indicated for adjunctive treatment of patients with peroxisomal disorders. Its Thiola is approved in the United States for the prevention of cystine (kidney) stone formation in patients with severe homozygous cystinuria.

Atara Biotherapeutics Company Profile

Atara Biotherapeutics, Inc. is a clinical-stage biopharmaceutical company. The Company is focused on developing therapies for patients with severe and life-threatening diseases. The Company operates through the business of developing and commercializing therapeutics segment. The Company is focused on developing allogeneic or third-party derived antigen-specific T-cells. T-cells are a type of white blood cell. The Company’s product candidate, ATA129, is a third-party derived Epstein-Barr virus CTL for the treatment of Epstein-Barr virus (EBV). ATA188 is in development for the treatment of multiple sclerosis. ATA520, which is a third-party donor derived WT1-CTL, targets cancers expressing the antigen Wilms Tumor 1 (WT1). ATA520 is in Phase I clinical trials. The Company’s T-cell product candidate, ATA230, which is a third-party derived cytomegalovirus-CTL (CMV-CTL), is in Phase II clinical trials for refractory CMV.

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