Proteostasis Therapeutics (NASDAQ:PTI) and Xenon Pharmaceuticals (NASDAQ:XENE) are both small-cap medical companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.

Volatility and Risk

Proteostasis Therapeutics has a beta of 1.34, suggesting that its stock price is 34% more volatile than the S&P 500. Comparatively, Xenon Pharmaceuticals has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.

Profitability

This table compares Proteostasis Therapeutics and Xenon Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Proteostasis Therapeutics N/A -74.97% -57.97%
Xenon Pharmaceuticals N/A -53.55% -35.62%

Earnings & Valuation

This table compares Proteostasis Therapeutics and Xenon Pharmaceuticals’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Proteostasis Therapeutics $5.00 million 18.25 -$59.13 million ($1.16) -1.51
Xenon Pharmaceuticals $6.83 million 66.53 -$41.60 million ($1.54) -8.44

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

Insider and Institutional Ownership

21.7% of Proteostasis Therapeutics shares are owned by institutional investors. Comparatively, 56.0% of Xenon Pharmaceuticals shares are owned by institutional investors. 19.8% of Proteostasis Therapeutics shares are owned by insiders. Comparatively, 8.4% of Xenon Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Proteostasis Therapeutics and Xenon Pharmaceuticals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Proteostasis Therapeutics 0 0 5 0 3.00
Xenon Pharmaceuticals 0 0 3 0 3.00

Proteostasis Therapeutics presently has a consensus price target of $5.75, suggesting a potential upside of 228.57%. Xenon Pharmaceuticals has a consensus price target of $24.00, suggesting a potential upside of 84.62%. Given Proteostasis Therapeutics’ higher probable upside, equities research analysts plainly believe Proteostasis Therapeutics is more favorable than Xenon Pharmaceuticals.

Summary

Xenon Pharmaceuticals beats Proteostasis Therapeutics on 7 of the 12 factors compared between the two stocks.

About Proteostasis Therapeutics

Proteostasis Therapeutics, Inc., a clinical stage biopharmaceutical company, discovers and develops novel therapeutics to treat cystic fibrosis (CF) and other diseases caused by an imbalance in the proteostasis network. The company's lead product candidates include cystic fibrosis transmembrane conductance regulator (CFTR) modulators comprising PTI-428, an amplifier, which has completed Phase II study; and PTI-801, a third generation corrector molecule and PTI-808, a potentiator molecule, which has completed Phase I study. It has a collaboration agreements with Cystic Fibrosis Foundation, Inc. to research, develop, and commercialize products for the treatment of CF, non-classical CF, and other pulmonary diseases in the United States or the European Union; and Genentech, Inc. for licensing the technology and materials relating to therapeutic small molecule modulators. The company was formerly known as Proteoguard, Inc. and changed its name to Proteostasis Therapeutics, Inc. in September 2007. Proteostasis Therapeutics, Inc. was founded in 2006 and is headquartered in Boston, Massachusetts.

About Xenon Pharmaceuticals

Xenon Pharmaceuticals, Inc. engages in discovering and developing therapeutics to improve the lives of patients with neurological disorders. It focuses on the treatment of epilepsy. Its products include XEN496, XEN1101, XEN901, and XEN007. The company was founded by Simon Neil Pimstone, Johannes J. P. Kastelein, and Michael R. Hayden on November 5, 1996 and is headquartered in Burnaby, Canada.

Receive News & Ratings for Proteostasis Therapeutics Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Proteostasis Therapeutics and related companies with MarketBeat.com's FREE daily email newsletter.