Critical Review: Absci (NASDAQ:ABSI) vs. Phathom Pharmaceuticals (NASDAQ:PHAT)

Phathom Pharmaceuticals (NASDAQ:PHAT) and Absci (NASDAQ:ABSI) are both small-cap medical companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, dividends and analyst recommendations.

Analyst Recommendations

This is a summary of current recommendations for Phathom Pharmaceuticals and Absci, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Phathom Pharmaceuticals	1	0	5	1	2.86
Absci	1	0	8	0	2.78

Phathom Pharmaceuticals presently has a consensus price target of $24.50, indicating a potential upside of 113.36%. Absci has a consensus price target of $13.43, indicating a potential upside of 61.05%. Given Phathom Pharmaceuticals’ stronger consensus rating and higher possible upside, research analysts plainly believe Phathom Pharmaceuticals is more favorable than Absci.

Profitability

This table compares Phathom Pharmaceuticals and Absci’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Phathom Pharmaceuticals	-76.77%	N/A	-44.29%
Absci	-6,450.76%	-66.32%	-57.01%

Volatility & Risk

Phathom Pharmaceuticals has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500. Comparatively, Absci has a beta of 2.32, indicating that its share price is 132% more volatile than the S&P 500.

Earnings and Valuation

This table compares Phathom Pharmaceuticals and Absci”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Phathom Pharmaceuticals	$204.89 million	4.47	-$221.25 million	($2.12)	-5.42
Absci	$1.84 million	708.03	-$115.18 million	($0.83)	-10.05

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

Insider and Institutional Ownership

99.0% of Phathom Pharmaceuticals shares are owned by institutional investors. Comparatively, 52.0% of Absci shares are owned by institutional investors. 9.3% of Phathom Pharmaceuticals shares are owned by company insiders. Comparatively, 10.5% of Absci shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Phathom Pharmaceuticals beats Absci on 9 of the 15 factors compared between the two stocks.

About Phathom Pharmaceuticals

Phathom Pharmaceuticals, Inc., biopharmaceutical company, focuses on developing and commercializing treatments for gastrointestinal diseases. The company has the rights in the United States, Europe, and Canada for an investigational potassium-competitive acid blocker (P-CAB) that blocks acid secretion in the stomach. It is also developing vonoprazan for the treatment of erosive gastroesophageal reflux disease; and in combination with antibiotics for the treatment of Helicobacter pylori infection. The company was incorporated in 2018 and is headquartered in Florham Park, New Jersey.

About Absci

Absci Corporation operates as a data-first generative artificial intelligence (AI) drug creation company in the United States. The company combines AI with scalable wet lab technologies to create biologics for patients. Its integrated drug creation platform is designed to improve upon traditional biologic drug discovery by using AI to simultaneously optimize multiple drug characteristics that may be important to development and therapeutic benefit. The company was founded in 2011 and is headquartered in Vancouver, Washington.