Tokai Pharmaceuticals (NASDAQ: NVUS) and Kamada (NASDAQ:KMDA) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.

Valuation and Earnings

This table compares Tokai Pharmaceuticals and Kamada’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Tokai Pharmaceuticals N/A N/A -$4.10 million N/A N/A
Kamada $87.83 million 2.01 $1.94 million ($0.06) -78.74

Kamada has higher revenue and earnings than Tokai Pharmaceuticals.

Insider and Institutional Ownership

39.8% of Tokai Pharmaceuticals shares are held by institutional investors. Comparatively, 7.3% of Kamada shares are held by institutional investors. 5.2% of Tokai Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Tokai Pharmaceuticals and Kamada, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tokai Pharmaceuticals 0 0 0 0 N/A
Kamada 0 0 2 0 3.00

Kamada has a consensus target price of $8.50, suggesting a potential upside of 79.89%. Given Kamada’s higher possible upside, analysts plainly believe Kamada is more favorable than Tokai Pharmaceuticals.

Profitability

This table compares Tokai Pharmaceuticals and Kamada’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tokai Pharmaceuticals N/A -138.81% -121.03%
Kamada -2.24% -2.94% -2.03%

Volatility and Risk

Tokai Pharmaceuticals has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500. Comparatively, Kamada has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500.

Summary

Kamada beats Tokai Pharmaceuticals on 7 of the 10 factors compared between the two stocks.

Tokai Pharmaceuticals Company Profile

Novus Therapeutics, Inc., formerly Tokai Pharmaceuticals, Inc., is a pharmaceutical company. The Company is focused on the acquisition, development, and commercialization of ear, nose, and throat products. It has two platforms: OP-01 Foam Platform and OP-02 Surfactant Program. OP-01 is developed with the intent to be used as a delivery vehicle for drugs treating ears, as well as the nasal and sinus cavities. OP-01 is currently being developed as an improved treatment option for acute otitis externa. OP-02 is a daily nasal spray that is designed to improve and maintain a healthy middle ear. OP-02 is being developed as a potential treatment option for patients with otitis media and Eustachian tube dysfunction. OP-02 is a combination drug product, which comprises two components: surfactant dipalmitoylphosphatidylcholine and a spreading agent cholesteryl palmitate. The product is sprayed through the nostrils toward the opening of the Eustachian tube at the back of the nasal cavity.

Kamada Company Profile

Kamada Ltd. is an Israel-based biopharmaceutical company, which develops, produces and markets therapeutics, based on chromatographic purification technology. It offers bio-therapeutics for human use, such as specialty proteins, specific immunoglobulins, and other prescription medicines. The Company’s product line includes intravenous AAT for chronic replacement therapy in individuals with congenital alpha-1 antitrypsin deficiency; KamRAB for prophylaxis of rabies infection; KamRho-D IM for prophylaxis of Rh hemolytic disease of the newborn; KamRho-D IV for treatment of immune thrombocytopenic purpura; and IVIG, a replacement therapy in primary and secondary immune therapy. Its product line also comprises Protosol to reduce blood loss in patients undergoing cardiac surgery; Heparin sodium injection for coagulation inhibition and prophylaxis of thromboembolic diseases and Heparin Lock Flush to maintain potency of intravenous injection device among other.

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