Spring Bank Pharmaceuticals (NASDAQ: SBPH) and Summit Therapeutics PLC (NASDAQ:SMMT) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, institutional ownership, earnings, valuation and profitability.

Profitability

This table compares Spring Bank Pharmaceuticals and Summit Therapeutics PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Spring Bank Pharmaceuticals N/A -86.83% -58.60%
Summit Therapeutics PLC -12.44% -29,334.40% -7.61%

Earnings & Valuation

This table compares Spring Bank Pharmaceuticals and Summit Therapeutics PLC’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Spring Bank Pharmaceuticals N/A N/A -$18.18 million ($2.43) -6.22
Summit Therapeutics PLC $30.33 million 4.91 -$9.46 million ($0.35) -34.36

Summit Therapeutics PLC has higher revenue and earnings than Spring Bank Pharmaceuticals. Summit Therapeutics PLC is trading at a lower price-to-earnings ratio than Spring Bank Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Spring Bank Pharmaceuticals has a beta of 2.95, meaning that its stock price is 195% more volatile than the S&P 500. Comparatively, Summit Therapeutics PLC has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Spring Bank Pharmaceuticals and Summit Therapeutics PLC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Spring Bank Pharmaceuticals 0 1 3 0 2.75
Summit Therapeutics PLC 0 0 3 0 3.00

Spring Bank Pharmaceuticals currently has a consensus target price of $26.33, suggesting a potential upside of 74.28%. Summit Therapeutics PLC has a consensus target price of $27.00, suggesting a potential upside of 124.51%. Given Summit Therapeutics PLC’s stronger consensus rating and higher probable upside, analysts plainly believe Summit Therapeutics PLC is more favorable than Spring Bank Pharmaceuticals.

Institutional and Insider Ownership

28.3% of Spring Bank Pharmaceuticals shares are held by institutional investors. Comparatively, 21.8% of Summit Therapeutics PLC shares are held by institutional investors. 17.6% of Spring Bank Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Summit Therapeutics PLC beats Spring Bank Pharmaceuticals on 6 of the 11 factors compared between the two stocks.

About Spring Bank Pharmaceuticals

Spring Bank Pharmaceuticals, Inc. is a clinical-stage biopharmaceutical company. The Company is engaged in the discovery and development of a class of therapeutics using its small molecule nucleic acid hybrid (SMNH) chemistry platform. The Company is developing its SMNH product, SB 9200, for the treatment of viral diseases. The Company’s SB 9200 selectively activates within infected cells the cellular proteins retinoic acid-inducible gene 1 (RIG-I) and nucleotide-binding oligomerization domain-containing protein 2 (NOD2) to inhibit viral replication and to cause the induction of intracellular interferon signaling pathways for antiviral defense. The Company is also developing a second SMNH product candidate, SB 11285, as an immunotherapeutic agent for the treatment of selected cancers through the activation of the STimulator of INterferon Genes (STING) pathway. The Company focuses on developing SB 9200 for the treatment of chronic hepatitis B virus (HBV).

About Summit Therapeutics PLC

Summit Therapeutics plc is a biopharmaceutical company, which is engaged in drug development. The Company is focused on the discovery, development and commercialization of medicines for indications for which there are no existing or only inadequate therapies. It is conducting clinical programs focused on the genetic disease Duchenne muscular dystrophy (DMD) and the infectious disease Clostridium difficile infection (CDI). Its lead DMD product candidate is ezutromid, which is an orally administered small molecule. Its lead CDI product candidate is ridinilazole, which is an orally administered small molecule antibiotic. Its Ridinilazole is in Phase II clinical trials. It has conducted over three Phase I clinical trials of ezutromid. Its DMD program is based on utrophin modulation. It has received an orphan drug designation to ezutromid for the treatment of DMD. It is also developing an earlier-stage pipeline of second and future generation utrophin modulators for the treatment of DMD.

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