SUMMIT THERAPEU/S (NASDAQ: SMMT) and Epizyme (NASDAQ:EPZM) are both small-cap medical companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, risk, valuation and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for SUMMIT THERAPEU/S and Epizyme, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SUMMIT THERAPEU/S 0 4 5 0 2.56
Epizyme 0 3 7 0 2.70

SUMMIT THERAPEU/S presently has a consensus price target of $14.71, suggesting a potential upside of 498.14%. Epizyme has a consensus price target of $23.10, suggesting a potential upside of 72.39%. Given SUMMIT THERAPEU/S’s higher possible upside, research analysts plainly believe SUMMIT THERAPEU/S is more favorable than Epizyme.

Risk and Volatility

SUMMIT THERAPEU/S has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Epizyme has a beta of 2.24, indicating that its share price is 124% more volatile than the S&P 500.

Profitability

This table compares SUMMIT THERAPEU/S and Epizyme’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SUMMIT THERAPEU/S -33.36% -105.24% -17.79%
Epizyme N/A -61.42% -50.53%

Insider and Institutional Ownership

29.9% of SUMMIT THERAPEU/S shares are held by institutional investors. Comparatively, 85.2% of Epizyme shares are held by institutional investors. 21.5% of Epizyme shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares SUMMIT THERAPEU/S and Epizyme’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SUMMIT THERAPEU/S $36.07 million 0.94 -$9.28 million ($0.75) -3.28
Epizyme $10.00 million 93.12 -$134.30 million ($2.18) -6.15

SUMMIT THERAPEU/S has higher revenue and earnings than Epizyme. Epizyme is trading at a lower price-to-earnings ratio than SUMMIT THERAPEU/S, indicating that it is currently the more affordable of the two stocks.

Summary

Epizyme beats SUMMIT THERAPEU/S on 8 of the 13 factors compared between the two stocks.

SUMMIT THERAPEU/S Company Profile

Summit Therapeutics plc, a biopharmaceutical company, focuses on the discovery, development, and commercialization of novel medicines to treat genetic and infectious diseases in the United Kingdom and North America. It is conducting clinical programmes focused on the genetic disease Duchenne muscular dystrophy (DMD) and the infectious disease Clostridium difficile infection (CDI). The company's lead DMD product candidate is ezutromid, an orally administered small molecule, which is in Phase II clinical trial in patients with DMD; and lead CDI product candidate is ridinilazole, an orally administered small molecule antibiotic that has completed Phase II clinical trials for the treatment of CDI disease. It has strategic alliance with the University of Oxford to develop utrophin modulators. The company was formerly known as Summit Corporation plc and changed its name to Summit Therapeutics plc in February 2015. Summit Therapeutics plc was founded in 2003 and is based in Abingdon, the United Kingdom.

Epizyme Company Profile

Epizyme, Inc., a clinical stage biopharmaceutical company, discovers and develops novel epigenetic medicines for patients with cancer and other diseases in the United States. Its product candidates include tazemetostat, an inhibitor of the EZH2, which is in Phase II clinical trial for patients with relapsed or refractory non-hodgkin lymphoma (NHL); Phase II clinical trial for relapsed or refractory patients with mesothelioma; Phase I dose-escalation and expansion study for children with INI1-negative solid tumors; Phase II clinical trials for patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL); Phase Ib/II clinical trial in elderly patients with DLBCL; and Phase II clinical trial for relapsed or refractory patients with mesothelioma characterized by BAP1 loss-of-function,; and Phase Ib/II clinical trial for the treatment of patients with relapsed or refractory metastatic non-small cell lung cancer, as well as Phase II clinical trial in adult patients with ovarian cancer. The company is also developing additional programs, such as pinometostat, an intravenously administered small molecule inhibitor of DOT1L for the treatment of acute leukemias; and PRMT5 inhibitor that is in Phase I clinical trial for patients with solid tumors and NHL. It has collaboration agreements with Celgene Corporation, Genentech Inc., and Glaxo Group Limited, as well as with Roche Molecular Systems, Inc., Eisai Co. Ltd., and Lymphoma Study Association. Epizyme, Inc. was founded in 2007 and is headquartered in Cambridge, Massachusetts.

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