Dynavax Technologies Corporation (NASDAQ: DVAX) and Aradigm Corporation (NASDAQ:ARDM) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, earnings, profitability, institutional ownership and dividends.

Insider & Institutional Ownership

59.8% of Dynavax Technologies Corporation shares are held by institutional investors. Comparatively, 33.6% of Aradigm Corporation shares are held by institutional investors. 2.9% of Dynavax Technologies Corporation shares are held by insiders. Comparatively, 7.3% of Aradigm Corporation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Dynavax Technologies Corporation has a beta of 1.48, suggesting that its share price is 48% more volatile than the S&P 500. Comparatively, Aradigm Corporation has a beta of 1.62, suggesting that its share price is 62% more volatile than the S&P 500.

Profitability

This table compares Dynavax Technologies Corporation and Aradigm Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dynavax Technologies Corporation -1,323.99% -92.09% -78.45%
Aradigm Corporation -196.65% -665.03% -83.01%

Valuation and Earnings

This table compares Dynavax Technologies Corporation and Aradigm Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Dynavax Technologies Corporation $7.71 million 143.08 -$94.16 million ($2.47) -8.16
Aradigm Corporation $9.54 million 6.46 -$14.99 million ($1.27) -3.36

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

Analyst Recommendations

This is a summary of recent ratings and price targets for Dynavax Technologies Corporation and Aradigm Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dynavax Technologies Corporation 0 0 5 0 3.00
Aradigm Corporation 0 0 1 0 3.00

Dynavax Technologies Corporation presently has a consensus price target of $27.80, indicating a potential upside of 37.97%. Aradigm Corporation has a consensus price target of $10.00, indicating a potential upside of 134.19%. Given Aradigm Corporation’s higher possible upside, analysts clearly believe Aradigm Corporation is more favorable than Dynavax Technologies Corporation.

Summary

Aradigm Corporation beats Dynavax Technologies Corporation on 7 of the 12 factors compared between the two stocks.

Dynavax Technologies Corporation Company Profile

Dynavax Technologies Corporation is a clinical-stage immunotherapy company. The Company is focused on leveraging the body’s innate and adaptive immune responses through toll-like receptor (TLR) stimulation. Its product candidates are being investigated for use in multiple cancer indications, as a vaccine for the prevention of hepatitis B and as a disease modifying therapy for asthma. Its products include HEPLISAV-B, AZD1419, SD-101, DV281, DV230F and DV1001. HEPLISAV-B is an investigational adult hepatitis B vaccine. AZD1419 is being developed for the treatment of asthma. SD-101 is an investigational TLR9 agonist designed to elicit a potent and focused immune response to cancer. DV281 is an investigational TLR9 agonist designed specifically for focused delivery to primary lung tumors and lung metastases. DV230F is indicated for the treatment of Liver Tumors. DV1001 targets TLR 7 and 8 agonist for multiple malignancies. DV230F and DV1001 are in pre-clinical stage of development.

Aradigm Corporation Company Profile

Aradigm Corporation is a pharmaceutical company focused on the development and commercialization of products for the treatment and prevention of severe respiratory diseases. The Company’s lead product candidate is Pulmaquin inhaled ciprofloxacin, which is in Phase III clinical trials. It offers AERx pulmonary drug delivery platform and other technologies. Its partnered programs under development include Inhaled Ciprofloxacin. It is also engaged in developing Smoking Cessation Therapy (ARD-1600 Inhaled Nicotine). Its lead development candidates are its formulations of the potent antibiotic ciprofloxacin (Pulmaquin (ARD-3150) and Lipoquin (ARD-3100)) that are delivered by inhalation for the management of infections associated with the severe respiratory diseases, such as cystic fibrosis (CF) and non-cystic fibrosis bronchiectasis (BE). Pulmaquin uses slow release liposomal formulation (Lipoquin) mixed with a small amount of ciprofloxacin dissolved in an aqueous medium.

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