Crispr Theraptc (NASDAQ: CRSP) and Merrimack Pharmaceuticals (NASDAQ:MACK) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, valuation, risk, earnings, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Crispr Theraptc and Merrimack Pharmaceuticals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Crispr Theraptc 0 4 4 0 2.50
Merrimack Pharmaceuticals 0 4 0 0 2.00

Crispr Theraptc currently has a consensus target price of $23.08, indicating a potential upside of 26.14%. Merrimack Pharmaceuticals has a consensus target price of $42.50, indicating a potential upside of 220.51%. Given Merrimack Pharmaceuticals’ higher probable upside, analysts clearly believe Merrimack Pharmaceuticals is more favorable than Crispr Theraptc.

Profitability

This table compares Crispr Theraptc and Merrimack Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Crispr Theraptc -406.61% -47.46% -22.13%
Merrimack Pharmaceuticals N/A N/A -99.74%

Insider & Institutional Ownership

23.9% of Crispr Theraptc shares are owned by institutional investors. 40.0% of Crispr Theraptc shares are owned by insiders. Comparatively, 8.5% of Merrimack Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Crispr Theraptc and Merrimack Pharmaceuticals’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Crispr Theraptc $10.18 million 72.97 -$79.90 million ($3.47) -5.27
Merrimack Pharmaceuticals $144.27 million 1.22 -$87.01 million $31.50 0.42

Crispr Theraptc has higher revenue, but lower earnings than Merrimack Pharmaceuticals. Crispr Theraptc is trading at a lower price-to-earnings ratio than Merrimack Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Summary

Crispr Theraptc beats Merrimack Pharmaceuticals on 7 of the 12 factors compared between the two stocks.

About Crispr Theraptc

Crispr Therapeutics AG is a Switzerland-based gene-editing company. The Company focuses on the development of transformative gene-based medicines for serious diseases using its Clustered Regularly Interspaced Short Palindromic Repeats (CRISPR)/Cas9 gene-editing platform. CRISPR/Cas9 can be programmed to cut, edit and correct disease-associated deoxyribonucleic acid (DNA) in a patient’s cell. The location at which the Cas9 molecular scissors cut the DNA to be edited is specified by guide ribonucleic acid (RNA), which is comprised of a crRNA component and a tracrRNA component, either individually or combined together as a single guide RNA. The Company has business operations in London, the United Kingdom, as well as research and development operations in Cambridge, the United States.

About Merrimack Pharmaceuticals

Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is engaged in discovering, developing and commercializing medicines consisting of therapeutics paired with companion diagnostics for the treatment of cancer. The Company has one marketed therapeutic oncology product and multiple targeted therapeutic oncology candidates in clinical development. Its advanced program is its therapeutic MM-398, which it markets in the United States under the brand name ONIVYDE. Its other clinical stage product candidates include MM-121, MM-141, MM-310, MM-302 and MM-151. The Company is developing in vitro and in vivo diagnostics for use with each of its oncology therapeutic product candidates. Its in vitro diagnostic agents employ biophysical or biochemical markers of cancer, or biomarkers. Its in vivo diagnostics take the form of imaging agents that may help identify patients likely to benefit from its therapeutic products by measuring deposition of its products in the tumor.

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