Oncomed Pharmaceuticals (NASDAQ: OMED) and Sorrento Tech (NASDAQ:ROKA) are both small-cap healthcare companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.
This table compares Oncomed Pharmaceuticals and Sorrento Tech’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of current ratings and price targets for Oncomed Pharmaceuticals and Sorrento Tech, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Oncomed Pharmaceuticals currently has a consensus price target of $6.00, indicating a potential upside of 109.06%. Given Oncomed Pharmaceuticals’ higher possible upside, equities research analysts plainly believe Oncomed Pharmaceuticals is more favorable than Sorrento Tech.
Valuation and Earnings
This table compares Oncomed Pharmaceuticals and Sorrento Tech’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Oncomed Pharmaceuticals||$25.15 million||4.32||-$103.10 million||($1.90)||-1.51|
|Sorrento Tech||$7.24 million||0.45||-$30.78 million||($8.79)||-0.07|
Sorrento Tech has lower revenue, but higher earnings than Oncomed Pharmaceuticals. Oncomed Pharmaceuticals is trading at a lower price-to-earnings ratio than Sorrento Tech, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
39.4% of Oncomed Pharmaceuticals shares are owned by institutional investors. Comparatively, 48.1% of Sorrento Tech shares are owned by institutional investors. 32.8% of Oncomed Pharmaceuticals shares are owned by insiders. Comparatively, 29.2% of Sorrento Tech shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
Oncomed Pharmaceuticals has a beta of 2.8, meaning that its share price is 180% more volatile than the S&P 500. Comparatively, Sorrento Tech has a beta of 2.22, meaning that its share price is 122% more volatile than the S&P 500.
Oncomed Pharmaceuticals beats Sorrento Tech on 10 of the 13 factors compared between the two stocks.
Oncomed Pharmaceuticals Company Profile
OncoMed Pharmaceuticals, Inc. (OncoMed) is a clinical-stage biopharmaceutical company. The Company focuses on discovering and developing therapeutics that address the fundamental biology driving cancer’s growth, resistance, recurrence and metastasis. The Company’s therapeutic candidates and preclinical programs include Demcizumab (Anti-DLL4, OMP-21M18), Tarextumab (Anti-Notch2/3, OMP-59R5), Vantictumab (anti-Fzd7, OMP-18R5), Ipafricept (Fzd8-Fc, OMP-54F28), Brontictuzumab (Anti-Notch1, OMP-52M51), Navicixizumab (Anti-DLL4/VEGF Bispecific, OMP-305B83), Anti-RSPO3 (OMP-131R10), Anti-TIGIT (OMP-313M32) and GITRL-Fc trimer (OMP-336B11). Demcizumab is a humanized monoclonal antibody that inhibits Delta-like Ligand 4 (DLL4) in the Notch signaling pathway. Tarextumab is a human monoclonal antibody that binds to both the Notch2 and Notch3 receptors.
Sorrento Tech Company Profile
Sorrento Tech, Inc., formerly Roka Bioscience, Inc., is a molecular diagnostics company. The Company is focused on the development and commercialization of molecular assay technologies for the detection of foodborne pathogens under the Atlas brand name. The Company offers Atlas Detection Assays and Atlas instrument in the North American food safety testing market and has rights to develop and commercialize its molecular testing solutions for a range of other industrial applications. The detection of foodborne pathogens is accomplished using culture-based assays, immunochemical-based assays and molecular-based assays. The Company sells its Atlas Detection Assays and related consumable supplies for use with its Atlas instruments. The Company’s Atlas instrument is an automated molecular diagnostic testing and a sample-in-result-out instrument that eliminates the need for batch processing and automates all aspects of molecular diagnostic testing on a single, integrated platform.
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