Critical Review: Assembly Biosciences (NASDAQ:ASMB) and Evoke Pharma (NASDAQ:EVOK)

Evoke Pharma (NASDAQ:EVOK) and Assembly Biosciences (NASDAQ:ASMB) are both small-cap medical companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, earnings, institutional ownership, analyst recommendations, risk and profitability.

Volatility and Risk

Evoke Pharma has a beta of -0.14, indicating that its share price is 114% less volatile than the S&P 500. Comparatively, Assembly Biosciences has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.

Insider and Institutional Ownership

19.9% of Assembly Biosciences shares are owned by institutional investors. 2.3% of Evoke Pharma shares are owned by insiders. Comparatively, 5.3% of Assembly Biosciences 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.

Valuation & Earnings

This table compares Evoke Pharma and Assembly Biosciences”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Evoke Pharma	$10.25 million	1.82	-$5.35 million	($2.07)	-5.24
Assembly Biosciences	$37.19 million	16.07	-$40.18 million	($4.79)	-7.89

Evoke Pharma has higher earnings, but lower revenue than Assembly Biosciences. Assembly Biosciences is trading at a lower price-to-earnings ratio than Evoke Pharma, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Evoke Pharma and Assembly Biosciences, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evoke Pharma	1	1	0	0	1.50
Assembly Biosciences	1	1	6	0	2.63

Assembly Biosciences has a consensus price target of $41.00, indicating a potential upside of 8.52%. Given Assembly Biosciences’ stronger consensus rating and higher possible upside, analysts plainly believe Assembly Biosciences is more favorable than Evoke Pharma.

Profitability

This table compares Evoke Pharma and Assembly Biosciences’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evoke Pharma	-36.23%	-101.40%	-31.86%
Assembly Biosciences	-117.20%	-149.01%	-39.04%

Summary

Assembly Biosciences beats Evoke Pharma on 8 of the 14 factors compared between the two stocks.

About Evoke Pharma

Evoke Pharma, Inc., a specialty pharmaceutical company, primarily focuses on the development and commercialization of drugs for the treatment of gastroenterological disorders and diseases. It offers Gimoti, a metoclopramide nasal spray to treat symptoms associated with acute and recurrent diabetic gastroparesis in adults. The company markets its products to gastroenterologists, internal medicine specialists, primary care physicians, and select health care providers. Evoke Pharma, Inc. was incorporated in 2007 and is headquartered in Solana Beach, California.

About Assembly Biosciences

Assembly Biosciences, Inc., a biotechnology company, develops therapeutic candidates for the treatment of viral diseases. It develops ABI-5366, a long-acting herpes simplex virus (HSV) helicase-primase inhibitor that is in Phase 1a/1b clinical trial to treat recurrent genital herpes; ABI-1179, which is in Phase 1a/1b clinical trial for the treatment of recurrent genital herpes; and ABI-6250, a small molecule orally bioavailable hepatitis delta virus entry inhibitor that is in Phase 1a clinical trial. The company also develops ABI-4334, a next-generation capsid assembly modulator, which is in Phase 1b clinical trial for the treatment of hepatitis B virus (HBV). In addition, it develops an oral non-nucleoside polymerase inhibitor targeting transplant-related herpesviruses; and a small molecule interferon-a receptor agonist targeting HBV and HDV. The company has collaboration agreements with Gilead Sciences, Inc. and BeiGene, Ltd. The company was formerly known as Ventrus Biosciences, Inc. and changed its name to Assembly Biosciences, Inc. in June 2014. Assembly Biosciences, Inc. was incorporated in 2005 and is headquartered in South San Francisco, California.