Catalyst Biosciences (NASDAQ: CBIO) and Novus Therapeutics (NASDAQ:NVUS) are both small-cap healthcare companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Institutional & Insider Ownership

22.9% of Catalyst Biosciences shares are owned by institutional investors. Comparatively, 40.8% of Novus Therapeutics shares are owned by institutional investors. 5.0% of Catalyst Biosciences shares are owned by company insiders. Comparatively, 5.2% of Novus Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and target prices for Catalyst Biosciences and Novus Therapeutics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Catalyst Biosciences 0 0 3 0 3.00
Novus Therapeutics 0 0 1 0 3.00

Catalyst Biosciences currently has a consensus target price of $45.00, suggesting a potential upside of 30.97%. Given Novus Therapeutics’ higher probable upside, analysts clearly believe Novus Therapeutics is more favorable than Catalyst Biosciences.

Profitability

This table compares Catalyst Biosciences and Novus Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Catalyst Biosciences -2,438.50% -91.67% -55.28%
Novus Therapeutics N/A -156.99% -140.33%

Volatility & Risk

Catalyst Biosciences has a beta of 2.73, indicating that its share price is 173% more volatile than the S&P 500. Comparatively, Novus Therapeutics has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500.

Valuation & Earnings

This table compares Catalyst Biosciences and Novus Therapeutics’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Catalyst Biosciences $400,000.00 499.08 -$16.94 million ($13.12) -2.62
Novus Therapeutics N/A N/A -$37.95 million ($3.94) -0.80

Catalyst Biosciences has higher revenue and earnings than Novus Therapeutics. Catalyst Biosciences is trading at a lower price-to-earnings ratio than Novus Therapeutics, indicating that it is currently the more affordable of the two stocks.

Catalyst Biosciences Company Profile

Catalyst Biosciences, Inc., formerly Targacept, Inc., is a clinical-stage biopharmaceutical company. The Company is focused on creating and developing medicines to address serious medical conditions. The Company focuses its product development efforts in the fields of hemostasis, including the treatment of hemophilia and surgical bleeding, and inflammation, including prevention of delayed graft function (DGF) in renal transplants and the treatment of dry age-related macular degeneration (dry AMD), a condition that can cause visual impairment or blindness. The Company’s advanced program is a coagulation Factor VIIa variant, CB 813d, that has completed a Phase I clinical trial in severe hemophilia A and B patients. In addition to its lead Factor VIIa program, it has approximately two other coagulation factors, a Factor IX variant, CB 2679d/ISU 304, that is in advanced preclinical development, and a Factor Xa variant that has reached the advanced lead preclinical-stage of development.

Novus Therapeutics Company Profile

Novus Therapeutics, Inc., formerly Tokai Pharmaceuticals, Inc., is a pharmaceutical company. The Company is focused on the acquisition, development, and commercialization of ear, nose, and throat products. It has two platforms: OP-01 Foam Platform and OP-02 Surfactant Program. OP-01 is developed with the intent to be used as a delivery vehicle for drugs treating ears, as well as the nasal and sinus cavities. OP-01 is currently being developed as an improved treatment option for acute otitis externa. OP-02 is a daily nasal spray that is designed to improve and maintain a healthy middle ear. OP-02 is being developed as a potential treatment option for patients with otitis media and Eustachian tube dysfunction. OP-02 is a combination drug product, which comprises two components: surfactant dipalmitoylphosphatidylcholine and a spreading agent cholesteryl palmitate. The product is sprayed through the nostrils toward the opening of the Eustachian tube at the back of the nasal cavity.

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