Analyzing Arcus Biosciences (NYSE:RCUS) & Cytokinetics (NASDAQ:CYTK)

Arcus Biosciences (NYSE:RCUS) and Cytokinetics (NASDAQ:CYTK) are both mid-cap healthcare companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, valuation, risk, institutional ownership, earnings, analyst recommendations and dividends.

Profitability

This table compares Arcus Biosciences and Cytokinetics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arcus Biosciences	-393.16%	-89.54%	-45.61%
Cytokinetics	-1,321.12%	N/A	-51.01%

Volatility & Risk

Arcus Biosciences has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500. Comparatively, Cytokinetics has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500.

Valuation & Earnings

This table compares Arcus Biosciences and Cytokinetics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arcus Biosciences	$247.00 million	13.56	-$353.00 million	($3.90)	-6.74
Cytokinetics	$88.04 million	92.02	-$784.96 million	($7.22)	-9.02

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

Institutional & Insider Ownership

92.9% of Arcus Biosciences shares are owned by institutional investors. 7.6% of Arcus Biosciences shares are owned by insiders. Comparatively, 2.6% of Cytokinetics shares are owned 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.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Arcus Biosciences and Cytokinetics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arcus Biosciences	1	3	10	0	2.64
Cytokinetics	1	1	18	0	2.85

Arcus Biosciences presently has a consensus target price of $38.30, suggesting a potential upside of 45.60%. Cytokinetics has a consensus target price of $103.37, suggesting a potential upside of 58.77%. Given Cytokinetics’ stronger consensus rating and higher probable upside, analysts clearly believe Cytokinetics is more favorable than Arcus Biosciences.

Summary

Arcus Biosciences beats Cytokinetics on 9 of the 14 factors compared between the two stocks.

About Arcus Biosciences

Arcus Biosciences, Inc., a clinical-stage biopharmaceutical company, develops and commercializes cancer therapies in the United States. The company's pipeline products include Domvanalimab, an anti-TIGIT antibody, which is in Phase 2 and Phase 3 clinical trial; and AB308, an investigational anti-TIGIT monoclonal antibody, which is in Phase 1b clinical trial to study people with advanced solid and hematologic malignancies. It also develops Etrumadenant, a dual A2a/A2b adenosine receptor antagonist, which is in Phase 2 clinical trial; Quemliclustat, a small-molecule CD73 inhibitor, which is Phase 1b and Phase 2 clinical trial; Zimberelimab, an anti-PD-1 antibody, which is in Phase 2 clinical trial for metastatic cell lung cancer and monotherapy; and AB521, an oral and small-molecule inhibitor of HIF-2a, which is in Phase 1 clinical trial for the treatment of Von Hippel-Lindau disease. In addition, the company's preclinical pipeline products include AB598, a CD39 antibody; and AB801, a small molecule Axl inhibitor. It has a clinical collaboration with AstraZeneca to evaluate domvanalimab in combination with durvalumab in a registrational phase 3 clinical trial in patients with unresectable Stage 3 NSCLC; and BVF Partners L.P. to support the discovery and development of compounds for the treatment of inflammatory diseases. Arcus Biosciences, Inc. was incorporated in 2015 and is headquartered in Hayward, California.

About Cytokinetics

Cytokinetics, Incorporated, a late-stage biopharmaceutical company, focuses on discovering, developing, and commercializing muscle activators and inhibitors as potential treatments for debilitating diseases. The company develops small molecule drug candidates primarily engineered to impact muscle function and contractility. Its drug candidates include omecamtiv mecarbil, a novel cardiac myosin activator that is in Phase III clinical trial in patients with heart failure. The company also develops CK-136, a novel cardiac troponin activator that is in Phase I clinical trial; CK-586, a small molecule cardiac myosin inhibitor, that is in Phase I clinical trial; and aficamten, a novel cardiac myosin inhibitor, which is in Phase III clinical trial for the treatment of patients with symptomatic obstructive hypertrophic cardiomyopathy. Cytokinetics, Incorporated has a strategic alliance with Ji Xing Pharmaceuticals Limited. The company was incorporated in 1997 and is headquartered in South San Francisco, California.