Heron Therapeutics (NASDAQ: HRTX) and Zynerba Pharmaceuticals (NASDAQ:ZYNE) are both medical companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitability and earnings.

Insider & Institutional Ownership

35.0% of Zynerba Pharmaceuticals shares are held by institutional investors. 19.9% of Heron Therapeutics shares are held by insiders. Comparatively, 10.0% of Zynerba Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk & Volatility

Heron Therapeutics has a beta of 2.12, indicating that its share price is 112% more volatile than the S&P 500. Comparatively, Zynerba Pharmaceuticals has a beta of 5.53, indicating that its share price is 453% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Heron Therapeutics and Zynerba Pharmaceuticals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Heron Therapeutics 0 0 11 0 3.00
Zynerba Pharmaceuticals 0 5 4 0 2.44

Heron Therapeutics presently has a consensus target price of $29.80, indicating a potential upside of 85.67%. Zynerba Pharmaceuticals has a consensus target price of $14.63, indicating a potential upside of 41.58%. Given Heron Therapeutics’ stronger consensus rating and higher probable upside, equities analysts plainly believe Heron Therapeutics is more favorable than Zynerba Pharmaceuticals.

Profitability

This table compares Heron Therapeutics and Zynerba Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Heron Therapeutics N/A -451.80% -152.23%
Zynerba Pharmaceuticals N/A -54.35% -48.11%

Valuation & Earnings

This table compares Heron Therapeutics and Zynerba Pharmaceuticals’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Heron Therapeutics $1.28 million 678.86 -$173.14 million ($4.26) -3.77
Zynerba Pharmaceuticals $10,000.00 13,697.58 -$23.38 million ($2.62) -3.94

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

Summary

Zynerba Pharmaceuticals beats Heron Therapeutics on 7 of the 12 factors compared between the two stocks.

Heron Therapeutics Company Profile

Heron Therapeutics, Inc. is a biotechnology company engaged in developing pharmaceutical products for patients suffering from cancer or pain. The Company’s product candidates include SUSTOL, HTX-019 and HTX-011. All of its product candidates utilize science and technology platforms, including its Biochronomer drug delivery technology. The Company’s SUSTOL (granisetron) injection, extended release is being developed for the prevention of both acute and delayed chemotherapy-induced nausea and vomiting (CINV) associated with moderately emetogenic chemotherapy (MEC) or highly emetogenic chemotherapy (HEC). HTX-019, which is an intravenous formulation of aprepitant, a neurokinin-1 (NK1) receptor antagonist, is being developed for the prevention of CINV. HTX-011, a long-acting formulation of the local anesthetic bupivacaine in a fixed-dose combination with the anti-inflammatory meloxicam, is being developed for the prevention of post-operative pain. HTX-011 is in Phase II clinical trials.

Zynerba Pharmaceuticals Company Profile

Zynerba Pharmaceuticals, Inc. is a specialty pharmaceutical company. The Company is engaged in developing and commercializing transdermal synthetic cannabinoid treatments for patients with high unmet needs. Its development pipeline includes two product candidates: ZYN002 and ZYN001. ZYN002 is a synthetic cannabidiol (CBD), which is a non-psychoactive cannabinoid, formulated as a patent-protected permeation-enhanced gel for transdermal delivery through the skin and into the circulatory system. ZYN002 is in Phase II clinical development in patients with refractory epilepsy, in patients with osteoarthritis of the knee, as well as in patients with Fragile X syndrome. ZYN001 is a pro-drug of tetrahydrocannabinol (THC) that enables transdermal delivery through the skin and into the circulatory system through a patch. ZYN001 is targeting two pain indications, fibromyalgia and peripheral neuropathic pain.

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