Intercept Pharmaceuticals (NASDAQ: ICPT) and Synergy Pharmaceuticals (NASDAQ:SGYP) are both small-cap medical companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, institutional ownership, risk and valuation.

Valuation and Earnings

This table compares Intercept Pharmaceuticals and Synergy Pharmaceuticals’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Intercept Pharmaceuticals $70.92 million 24.29 -$361.26 million ($15.50) -4.43
Synergy Pharmaceuticals $2.41 million 312.70 -$216.83 million ($1.16) -2.89

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

Analyst Ratings

This is a summary of recent recommendations for Intercept Pharmaceuticals and Synergy Pharmaceuticals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intercept Pharmaceuticals 2 9 7 0 2.28
Synergy Pharmaceuticals 1 0 9 0 2.80

Intercept Pharmaceuticals currently has a consensus target price of $158.11, suggesting a potential upside of 130.37%. Synergy Pharmaceuticals has a consensus target price of $8.90, suggesting a potential upside of 165.67%. Given Synergy Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts plainly believe Synergy Pharmaceuticals is more favorable than Intercept Pharmaceuticals.

Risk and Volatility

Intercept Pharmaceuticals has a beta of -2.09, indicating that its share price is 309% less volatile than the S&P 500. Comparatively, Synergy Pharmaceuticals has a beta of 1065.76, indicating that its share price is 106,476% more volatile than the S&P 500.

Profitability

This table compares Intercept Pharmaceuticals and Synergy Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intercept Pharmaceuticals -543.35% -135.24% -54.37%
Synergy Pharmaceuticals N/A -485.02% -202.73%

Insider and Institutional Ownership

82.2% of Intercept Pharmaceuticals shares are held by institutional investors. Comparatively, 71.5% of Synergy Pharmaceuticals shares are held by institutional investors. 4.5% of Intercept Pharmaceuticals shares are held by insiders. Comparatively, 3.8% of Synergy 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.

Summary

Synergy Pharmaceuticals beats Intercept Pharmaceuticals on 8 of the 13 factors compared between the two stocks.

Intercept Pharmaceuticals Company Profile

Intercept Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is focused on the development and commercialization of therapeutics to treat non-viral, progressive liver diseases. The Company’s product candidates have the potential to treat orphan and more prevalent diseases for which there are limited therapeutic solutions. The Company’s product candidate, obeticholic acid (OCA), is a bile acid analog, a chemical substance that has a structure based on a naturally occurring human bile acid that selectively binds to and activates the farnesoid X receptor (FXR). In addition to OCA, it is developing other bile acid analog compounds targeting FXR and a second dedicated bile acid receptor called TGR5, which is a target of interest for the treatment of type 2 diabetes and other gastrointestinal indications. The Company is also developing other products INT-767 for the treatment of fibrosis and INT-777 for the treatment of type 2 diabetes.

Synergy Pharmaceuticals Company Profile

Synergy Pharmaceuticals Inc. is a biopharmaceutical company focused on the development and commercialization of gastrointestinal (GI) therapies. The Company’s product candidates include TRULANCE (plecanatide) and dolcanatide. The Company is engaged in the discovery, research and development efforts around analogs of uroguanylin for the treatment of GI diseases and disorders. TRULANCE is designed to replicate the function of uroguanylin. Dolcanatide is being evaluated for inflammatory bowel disease (IBD). TRULANCE is approved in the United States under the trademark name TRULANCE, for the treatment of adults with chronic idiopathic constipation (CIC). In addition, it is developing TRULANCE for the treatment of adults with irritable bowel syndrome with constipation (IBS-C). Dolcanatide is designed to be an analog of uroguanylin with enhanced resistance to standard digestive breakdown by proteases in the intestine.

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