Contrasting Passage Bio (NASDAQ:PASG) and PepGen (NASDAQ:PEPG)

PepGen (NASDAQ:PEPG) and Passage Bio (NASDAQ:PASG) are both small-cap medical companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Valuation and Earnings

This table compares PepGen and Passage Bio”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PepGen	N/A	N/A	-$89.98 million	($2.82)	-1.98
Passage Bio	N/A	N/A	-$64.77 million	($14.40)	-0.69

PepGen is trading at a lower price-to-earnings ratio than Passage Bio, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and price targets for PepGen and Passage Bio, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PepGen	2	0	4	0	2.33
Passage Bio	1	0	3	0	2.50

PepGen presently has a consensus price target of $10.00, indicating a potential upside of 78.89%. Passage Bio has a consensus price target of $42.67, indicating a potential upside of 330.11%. Given Passage Bio’s stronger consensus rating and higher possible upside, analysts clearly believe Passage Bio is more favorable than PepGen.

Institutional & Insider Ownership

58.0% of PepGen shares are owned by institutional investors. Comparatively, 53.5% of Passage Bio shares are owned by institutional investors. 4.6% of PepGen shares are owned by company insiders. Comparatively, 4.3% of Passage Bio shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares PepGen and Passage Bio’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PepGen	N/A	-84.15%	-65.59%
Passage Bio	N/A	-102.09%	-52.97%

Risk and Volatility

PepGen has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500. Comparatively, Passage Bio has a beta of 1.86, suggesting that its share price is 86% more volatile than the S&P 500.

Summary

PepGen beats Passage Bio on 6 of the 11 factors compared between the two stocks.

About PepGen

PepGen Inc., a clinical-stage biotechnology company, focuses on the development of oligonucleotide therapeutics for use in the treatment of severe neuromuscular and neurologic diseases. Its lead product candidate is PGN-EDO51, an EDO peptide that is in Phase 2 clinical trial to treat Duchenne muscular dystrophy (DMD) patients. The company is also developing PGN-EDODM1, an EDO peptide-conjugated PMO, which is in Phase 1 clinical trial for the treatment of myotonic dystrophy type 1, as well as EDO therapeutic candidates, such as PGN-EDO53, PGN-EDO45, and PGN-EDO44 for the treatment of DMD. PepGen Inc. was founded in 2018 and is based in Boston, Massachusetts.

About Passage Bio

Passage Bio, Inc., a genetic medicines company, develops gene therapies for central nervous system diseases. It develops PBGM01, a functional GLB1 gene encoding ß-galactosidase for infantile GM1; PBFT02, a functional granulin (GRN) and gene encoding progranulin (PGRN) for the treatment of FTD caused by progranulin deficiency; and PBKR03, a functional GALC gene encoding the hydrolytic enzyme galactosylceramidase for infantile Krabbe disease. The company develops PBML04 for the treatment of metachromatic leukodystrophy; PBAL05 for the treatment of amyotrophic lateral sclerosis; and other program for huntington's disease. It has a strategic research collaboration with the Trustees of the University of Pennsylvania's Gene Therapy Program; and collaboration agreement, and a development services and clinical supply agreement with Catalent Maryland, Inc. Passage Bio, Inc. was incorporated in 2017 and is headquartered in Philadelphia, Pennsylvania.