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

Analyst Ratings

This is a summary of current ratings and price targets for Aurinia Pharmaceuticals and Akebia Therapeutics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aurinia Pharmaceuticals 0 0 8 0 3.00
Akebia Therapeutics 0 0 6 0 3.00

Aurinia Pharmaceuticals presently has a consensus target price of $10.57, suggesting a potential upside of 60.66%. Akebia Therapeutics has a consensus target price of $23.83, suggesting a potential upside of 23.75%. Given Aurinia Pharmaceuticals’ higher possible upside, equities analysts plainly believe Aurinia Pharmaceuticals is more favorable than Akebia Therapeutics.

Institutional & Insider Ownership

27.8% of Aurinia Pharmaceuticals shares are held by institutional investors. Comparatively, 57.6% of Akebia Therapeutics shares are held by institutional investors. 8.0% of Akebia Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Aurinia Pharmaceuticals and Akebia Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aurinia Pharmaceuticals -16,648.93% -28.61% -22.50%
Akebia Therapeutics N/A -218.74% -52.65%

Earnings & Valuation

This table compares Aurinia Pharmaceuticals and Akebia Therapeutics’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Aurinia Pharmaceuticals $421,000.00 835.05 -$32.52 million ($1.37) -4.80
Akebia Therapeutics $50.92 million 6.92 -$140.36 million ($3.63) -5.31

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

Volatility and Risk

Aurinia Pharmaceuticals has a beta of 2.56, suggesting that its share price is 156% more volatile than the S&P 500. Comparatively, Akebia Therapeutics has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500.

Summary

Aurinia Pharmaceuticals beats Akebia Therapeutics on 8 of the 12 factors compared between the two stocks.

About Aurinia Pharmaceuticals

Aurinia Pharmaceuticals Inc. is a Canada-based clinical-stage biopharmaceutical company operating in the field of nephrology and autoimmunity. The Company’s primary business is the development of a therapeutic drug to treat autoimmune diseases, in particular lupus nephritis (LN). It is focused on the development of its lead compound voclosporin, a therapeutic immunomodulating drug candidate, which is a second-generation calcineurin inhibitors (CNI) to treat patients afflicted with LN. Voclosporin is an oral drug, administered twice daily. It is structurally similar to cyclosporine A (CsA), but is chemically modified on the amino acid-1 residue. It has completed two Phase III clinical studies in patients with moderate to severe psoriasis. It has completed Phase IIb clinical trial, which is a randomized, controlled, double-blind study comparing the efficacy of voclosporin as a component of multi-targeted therapy against placebo in achieving remission in patients with active LN.

About Akebia Therapeutics

Akebia Therapeutics, Inc. is a biopharmaceutical company. The Company focuses on the development and commercialization of therapeutics based on hypoxia-inducible factor (HIF) biology. The Company’s lead product candidate, vadadustat, is indicated for the treatment of anemia in chronic kidney disease (CKD). It is involved in developing vadadustat as an oral therapy. The Company’s vadadustat is a HIF-prolyl-hydroxylase (HIF-PH) inhibitor in Phase III development for the treatment of anemia of CKD. In addition to vadadustat, the Company is engaged in developing a HIF-based portfolio of product candidates that target serious diseases of unmet need. Its portfolio includes product candidates developed internally, such as AKB-6899, as well as in-licensed product candidates, including AKB-5169. AKB-5169 is a preclinical compound in development as an oral treatment for inflammatory bowel disease (IBD).

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