Recro Pharma (NASDAQ: REPH) and PLx Pharma (NASDAQ:PLXP) are both small-cap medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, valuation, risk, earnings and profitability.

Risk & Volatility

Recro Pharma has a beta of -0.5, meaning that its share price is 150% less volatile than the S&P 500. Comparatively, PLx Pharma has a beta of 1.82, meaning that its share price is 82% more volatile than the S&P 500.

Profitability

This table compares Recro Pharma and PLx Pharma’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Recro Pharma -51.88% -60.01% -20.86%
PLx Pharma N/A -154.79% -86.47%

Institutional & Insider Ownership

61.6% of Recro Pharma shares are owned by institutional investors. Comparatively, 21.9% of PLx Pharma shares are owned by institutional investors. 21.6% of Recro Pharma shares are owned by insiders. Comparatively, 47.7% of PLx Pharma shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Recro Pharma and PLx Pharma’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Recro Pharma $69.34 million 2.79 -$30.20 million ($2.19) -4.61
PLx Pharma N/A N/A -$21.32 million N/A N/A

PLx Pharma has lower revenue, but higher earnings than Recro Pharma.

Analyst Ratings

This is a summary of current ratings and recommmendations for Recro Pharma and PLx Pharma, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Recro Pharma 0 1 3 0 2.75
PLx Pharma 0 0 1 0 3.00

Recro Pharma presently has a consensus target price of $12.13, indicating a potential upside of 20.05%. Given Recro Pharma’s higher possible upside, equities research analysts clearly believe Recro Pharma is more favorable than PLx Pharma.

Summary

Recro Pharma beats PLx Pharma on 6 of the 11 factors compared between the two stocks.

Recro Pharma Company Profile

Recro Pharma, Inc. is a clinical-stage specialty pharmaceutical company. The Company is engaged in developing products for hospitals and ambulatory care settings that is developing non-opioid products for treatment of serious acute pain. The Company’s lead product candidate is an injectable form of meloxicam. Its product candidates for pain indications include injectable meloxicam, a product candidate in development for the treatment of acute post-operative pain; Dex-IN, a product candidate under development for the treatment of post-operative pain; Dex-SL, a product candidate for the treatment of chronic pain, and Fadolmidine (Fado), a product candidate used by injection into the spine for pain associated with surgery or certain types of chronic pain and which the Company pursues as a topical product for local application to treat serious pain associated with nerve damage to local tissues (neuropathies), especially of the lower extremities, which can occur in diabetic patients.

PLx Pharma Company Profile

PLx Pharma Inc., formerly Dipexium Pharmaceuticals, Inc., is a biopharmaceutical company. The Company is a late stage specialty pharmaceutical company focusing on commercializing its lead products: Aspertec 325 mg and Aspertec 81 mg (Aspertec). The Company’s products and technology includes PLxGuard delivery system, Aspertec 325 mg, PL1100/PL1200 Ibuprofen. PLxGuard delivery system uses surface acting lipids, such as phospholipids and free fatty acids, to modify the physiochemical properties of various drugs to selectively release these drugs to targeted portions of the GI tract. The Company’s lead product Aspertec 325 mg is a liquid-fill aspirin capsule for prevention of cardiovascular disease. Through PLxGuard delivery system the Company creates a lipid-based formulation of ibuprofen, PL1200 Ibuprofen Capsules, 200 mg.

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