Intercept Pharmaceuticals (NASDAQ: ICPT) and Revance Therapeutics (NASDAQ:RVNC) are both small-cap healthcare companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, dividends, risk, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares Intercept Pharmaceuticals and Revance Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intercept Pharmaceuticals -344.74% -176.51% -57.15%
Revance Therapeutics -37,161.00% -67.85% -57.91%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Intercept Pharmaceuticals and Revance Therapeutics, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intercept Pharmaceuticals 2 9 10 0 2.38
Revance Therapeutics 0 1 7 0 2.88

Intercept Pharmaceuticals currently has a consensus price target of $140.45, suggesting a potential upside of 155.60%. Revance Therapeutics has a consensus price target of $45.00, suggesting a potential upside of 30.43%. Given Intercept Pharmaceuticals’ higher probable upside, equities analysts plainly believe Intercept Pharmaceuticals is more favorable than Revance Therapeutics.

Valuation & Earnings

This table compares Intercept Pharmaceuticals and Revance Therapeutics’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Intercept Pharmaceuticals $24.95 million 55.28 -$412.83 million ($14.80) -3.71
Revance Therapeutics $300,000.00 4,113.55 -$89.27 million ($3.81) -9.06

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

Volatility and Risk

Intercept Pharmaceuticals has a beta of -2.05, indicating that its share price is 305% less volatile than the S&P 500. Comparatively, Revance Therapeutics has a beta of 1.62, indicating that its share price is 62% more volatile than the S&P 500.

Institutional & Insider Ownership

73.8% of Intercept Pharmaceuticals shares are held by institutional investors. Comparatively, 76.7% of Revance Therapeutics shares are held by institutional investors. 4.5% of Intercept Pharmaceuticals shares are held by company insiders. Comparatively, 18.9% of Revance Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Revance Therapeutics beats Intercept Pharmaceuticals on 8 of the 14 factors compared between the two stocks.

Intercept Pharmaceuticals Company Profile

Intercept Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is focused on the development and commercialization of therapeutics to treat non-viral, progressive liver diseases. The Company’s product candidates have the potential to treat orphan and more prevalent diseases for which there are limited therapeutic solutions. The Company’s product candidate, obeticholic acid (OCA), is a bile acid analog, a chemical substance that has a structure based on a naturally occurring human bile acid that selectively binds to and activates the farnesoid X receptor (FXR). In addition to OCA, it is developing other bile acid analog compounds targeting FXR and a second dedicated bile acid receptor called TGR5, which is a target of interest for the treatment of type 2 diabetes and other gastrointestinal indications. The Company is also developing other products INT-767 for the treatment of fibrosis and INT-777 for the treatment of type 2 diabetes.

Revance Therapeutics Company Profile

Revance Therapeutics, Inc. is a clinical-stage biotechnology company. The Company is focused on the development, manufacturing and commercialization of botulinum toxin products for multiple aesthetic and therapeutic indications. Its peptide technology enables delivery of botulinum toxin type A through two investigational drug product candidates, DaxibotulinumtoxinA for Injection (RT002), or RT002 injectable, and DaxibotulinumtoxinA Topical Gel (RT001), or RT001 topical. It is engaged in the clinical development for RT002 injectable. RT002 injectable utilizes botulinum toxin-peptide complex in a saline-based formulation. In RT002 injectable, the peptide interacts with both extracellular structures and cell surface receptors in the targeted muscle. This interaction restricts the toxin molecule to the target site and reduces unwanted spread to other neighboring muscles. It is focusing on developing RT002 for the treatment of glabellar lines, cervical dystonia and plantar fasciitis.

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