Critical Analysis: Anika Therapeutics (NASDAQ:ANIK) versus Rhythm Pharmaceuticals (NASDAQ:RYTM)

Rhythm Pharmaceuticals (NASDAQ:RYTM) and Anika Therapeutics (NASDAQ:ANIK) are both healthcare companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitability.

Insider & Institutional Ownership

91.5% of Anika Therapeutics shares are held by institutional investors. 5.9% of Rhythm Pharmaceuticals shares are held by company insiders. Comparatively, 12.1% of Anika Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Rhythm Pharmaceuticals has a beta of 1.97, suggesting that its share price is 97% more volatile than the S&P 500. Comparatively, Anika Therapeutics has a beta of 0.2, suggesting that its share price is 80% less volatile than the S&P 500.

Profitability

This table compares Rhythm Pharmaceuticals and Anika Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rhythm Pharmaceuticals	-85.59%	-159.87%	-44.00%
Anika Therapeutics	-3.14%	0.20%	0.15%

Earnings & Valuation

This table compares Rhythm Pharmaceuticals and Anika Therapeutics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rhythm Pharmaceuticals	$189.76 million	35.63	-$196.54 million	($3.11)	-31.73
Anika Therapeutics	$112.82 million	2.45	-$10.88 million	($0.27)	-76.37

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

Analyst Ratings

This is a breakdown of recent ratings and target prices for Rhythm Pharmaceuticals and Anika Therapeutics, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rhythm Pharmaceuticals	1	3	17	0	2.76
Anika Therapeutics	1	0	2	1	2.75

Rhythm Pharmaceuticals currently has a consensus price target of $140.67, indicating a potential upside of 42.56%. Anika Therapeutics has a consensus price target of $22.00, indicating a potential upside of 6.70%. Given Rhythm Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts clearly believe Rhythm Pharmaceuticals is more favorable than Anika Therapeutics.

Summary

Anika Therapeutics beats Rhythm Pharmaceuticals on 8 of the 15 factors compared between the two stocks.

About Rhythm Pharmaceuticals

Rhythm Pharmaceuticals, Inc., a commercial-stage biopharmaceutical company, focuses on the rare neuroendocrine diseases. The company's lead product candidate is IMCIVREE (setmelanotide), a rare melanocortin-4 receptor for the treatment of pro-opiomelanocortin (POMC), proprotein convertase subtilisin/kexin type 1, leptin receptor (LEPR) deficiency obesity, and Bardet-Biedl and Alström syndrome. It is in Phase 3 clinical trials for treating POMC or LEPR heterozygous deficiency obesities, steroid receptor coactivator 1 deficiency obesity, SH2B1 deficiency obesity, MC4 receptor deficiency obesity, and other MC4R disorders. The company has licensing agreements with LG Chem, Ltd; Ipsen Pharma S.A.S; Camurus; RareStone Group Ltd.; and LG Chem, Ltd. The company was formerly known as Rhythm Metabolic, Inc. and changed its name to Rhythm Pharmaceuticals, Inc. in October 2015. Rhythm Pharmaceuticals, Inc. was founded in 2008 and is headquartered in Boston, Massachusetts.

About Anika Therapeutics

Anika Therapeutics, Inc., a joint preservation company, creates and delivers advancements in early intervention orthopedic care in the areas of osteoarthritis (OA) pain management, regenerative solutions, sports medicine, and arthrosurface joint solutions in the United States, Europe, and internationally. The company develops, manufactures, and commercializes products based on hyaluronic acid (HA) technology platform. Its OA pain management products includes Monovisc and Orthovisc, an injectable HA-based viscosupplement for the pain relief from osteoarthritis conditions; and Cingal, a single-injection OA pain management product to provide both short- and long-term pain relief. The company’s joint preservation and restoration product family comprises and orthopedic regenerative solutions, including Hyalofast and Tactoset; sports medicine solutions used to repair and reconstruct damaged ligaments and tendons; and preserving joint solutions, including partial joint replacement, joint resurfacing, and invasive and bone sparing implants, which are designed to treat upper and lower extremity orthopedic conditions. In addition, it offers non-orthopedic products comprising HA-based products for non-orthopedic applications including Hyvisc, a molecular weight injectable HA veterinary product; Hyalobarrier, an anti-adhesion barrier indicated for use after abdominal-pelvic surgeries; and Hyalomatrix used for the treatment of burns and ulcers, as well as products used for the treatment of ears, nose and throat disorders, and ophthalmic products. The company was founded in 1983 and is headquartered in Bedford, Massachusetts.