Iovance Biotherapeutics (NASDAQ: IOVA) and InVitae (NYSE:NVTA) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Profitability

This table compares Iovance Biotherapeutics and InVitae’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Iovance Biotherapeutics N/A -53.59% -51.25%
InVitae -206.95% -115.25% -67.79%

Institutional & Insider Ownership

75.9% of Iovance Biotherapeutics shares are owned by institutional investors. Comparatively, 66.5% of InVitae shares are owned by institutional investors. 13.2% of Iovance Biotherapeutics shares are owned by company insiders. Comparatively, 9.9% of InVitae shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Iovance Biotherapeutics and InVitae’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Iovance Biotherapeutics N/A N/A -$52.89 million ($1.30) -6.69
InVitae $25.05 million 17.94 -$100.25 million ($2.55) -3.33

Iovance Biotherapeutics has higher earnings, but lower revenue than InVitae. Iovance Biotherapeutics is trading at a lower price-to-earnings ratio than InVitae, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for Iovance Biotherapeutics and InVitae, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Iovance Biotherapeutics 0 0 10 0 3.00
InVitae 0 0 3 0 3.00

Iovance Biotherapeutics presently has a consensus target price of $15.31, suggesting a potential upside of 76.01%. InVitae has a consensus target price of $14.33, suggesting a potential upside of 67.45%. Given Iovance Biotherapeutics’ higher possible upside, research analysts clearly believe Iovance Biotherapeutics is more favorable than InVitae.

Summary

Iovance Biotherapeutics beats InVitae on 9 of the 10 factors compared between the two stocks.

Iovance Biotherapeutics Company Profile

Iovance Biotherapeutics, Inc., formerly Lion Biotechnologies, Inc., is a clinical-stage biopharmaceutical company. The Company is focused on the development and commercialization of cancer immunotherapy products designed to harness the power of a patient’s own immune system to eradicate cancer cells. The Company’s lead program is an adoptive cell therapy utilizing tumor-infiltrating lymphocytes, which are T cells derived from patients’ tumors, for the treatment of metastatic melanoma. As of December 31, 2016, it had an on-going Phase II clinical trial of its lead product candidate, LN-144, TIL for the treatment of metastatic melanoma. The Company is developing LN-145 to treat cervical and head and neck cancers. It is collaborating with the National Cancer Institute to evaluate unmodified TIL in other solid tumor indications, such as ocular melanoma, bladder, breast and lung cancer. It is collaborating with the NCI to evaluate TIL in combination with the checkpoint inhibitor, Keytruda.

InVitae Company Profile

Invitae Corporation utilizes an integrated portfolio of laboratory processes, software tools and informatics capabilities to process deoxyribonucleic acid (DNA)-containing samples, analyze information about patient-specific genetic variation and generate test reports for clinicians and their patients. As of December 31, 2016, the Company’s products consisted of assays totaling over 1,100 genes that could be used for multiple indications, including hereditary cancer, neurological disorders, cardiovascular disorders, pediatric disorders and other hereditary conditions. The Company offers panels for a range of hereditary conditions in cancer, cardiology, neuromuscular, pediatric and rare diseases. The Company focuses on genetic testing, genome network and genome management. The Company offers full gene sequencing and deletion/duplication analysis as a standard for all of its tests. The Company holds interests in AltaVoice, a patient-centered data company.

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