Epizyme (NASDAQ: EPZM) and Vanda Pharmaceuticals (NASDAQ:VNDA) are both small-cap medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.
Insider and Institutional Ownership
85.3% of Epizyme shares are owned by institutional investors. Comparatively, 88.4% of Vanda Pharmaceuticals shares are owned by institutional investors. 25.2% of Epizyme shares are owned by company insiders. Comparatively, 7.6% of Vanda Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Risk & Volatility
Epizyme has a beta of 2, indicating that its stock price is 100% more volatile than the S&P 500. Comparatively, Vanda Pharmaceuticals has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500.
This table compares Epizyme and Vanda Pharmaceuticals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of recent recommendations and price targets for Epizyme and Vanda Pharmaceuticals, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Epizyme presently has a consensus target price of $22.67, suggesting a potential upside of 48.63%. Vanda Pharmaceuticals has a consensus target price of $21.83, suggesting a potential upside of 50.57%. Given Vanda Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts plainly believe Vanda Pharmaceuticals is more favorable than Epizyme.
Earnings and Valuation
This table compares Epizyme and Vanda Pharmaceuticals’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Epizyme||$8.01 million||131.90||-$110.21 million||($2.27)||-6.72|
|Vanda Pharmaceuticals||$146.02 million||4.46||-$18.01 million||($0.31)||-46.77|
Vanda Pharmaceuticals has higher revenue and earnings than Epizyme. Vanda Pharmaceuticals is trading at a lower price-to-earnings ratio than Epizyme, indicating that it is currently the more affordable of the two stocks.
Vanda Pharmaceuticals beats Epizyme on 8 of the 14 factors compared between the two stocks.
Epizyme, Inc. is a clinical-stage biopharmaceutical company. The Company discovers, develops and plans to commercialize epigenetic therapies for cancer patients. The Company is engaged in the discovery and development of novel epigenetic therapies for cancer patients. The Company develops small molecule inhibitors of a class of enzymes known as histone methyltransferases (HMTs). The Company develops small molecule inhibitors of other chromatin modifying proteins (CMPs). The Company’s lead product candidate, tazemetostat, is a potent and selective inhibitor of the enhancer of zeste homolog 2 (EZH2) histone methyltransferases (HMT), an enzyme that plays an important role in various cancers. The Company is evaluating tazemetostat in a Phase II study in adults with relapsed or refractory non-Hodgkin lymphoma (NHL), and one Phase I study in children with molecularly defined solid tumors. The Company owns the global development and commercialization rights to tazemetostat outside of Japan.
About Vanda Pharmaceuticals
Vanda Pharmaceuticals Inc. is a biopharmaceutical company. The Company is focused on the development and commercialization of therapies to address unmet medical needs. Its product portfolio includes HETLIOZ (tasimelteon), Fanapt (iloperidone), Tradipitant (VLY-686), Trichostatin A and AQW051. It offers HETLIOZ for the treatment of Non-24-Hour Sleep-Wake Disorder (Non-24). HETLIOZ is in clinical development for the treatment of Pediatric Non-24, Jet Lag Disorder and Smith-Magenis Syndrome. It offers Fanapt for the treatment of schizophrenia. Fanapt has potential utility in various other disorders. Tradipitant is a small molecule neurokinin-1 receptor (NK-1R) antagonist, which is in clinical development for the treatment of chronic pruritus in atopic dermatitis. Trichostatin A is a small molecule histone deacetylase (HDAC) inhibitor. AQW051 is a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist. AQW051 is indicated for the treatment of central nervous system disorders.
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