Financial Analysis: Amylyx Pharmaceuticals (NASDAQ:AMLX) and Alkermes (NASDAQ:ALKS)

Alkermes (NASDAQ:ALKS) and Amylyx Pharmaceuticals (NASDAQ:AMLX) are both mid-cap healthcare companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings for Alkermes and Amylyx Pharmaceuticals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alkermes	1	4	12	1	2.72
Amylyx Pharmaceuticals	1	0	8	2	3.00

Alkermes currently has a consensus target price of $54.56, indicating a potential upside of 11.27%. Amylyx Pharmaceuticals has a consensus target price of $36.25, indicating a potential downside of 1.21%. Given Alkermes’ higher probable upside, equities research analysts clearly believe Alkermes is more favorable than Amylyx Pharmaceuticals.

Insider and Institutional Ownership

95.2% of Alkermes shares are owned by institutional investors. Comparatively, 95.8% of Amylyx Pharmaceuticals shares are owned by institutional investors. 4.6% of Alkermes shares are owned by insiders. Comparatively, 10.9% of Amylyx Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Alkermes has a beta of 0.34, indicating that its stock price is 66% less volatile than the S&P 500. Comparatively, Amylyx Pharmaceuticals has a beta of -0.21, indicating that its stock price is 121% less volatile than the S&P 500.

Earnings and Valuation

This table compares Alkermes and Amylyx Pharmaceuticals”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alkermes	$1.48 billion	5.57	$241.66 million	$0.38	129.04
Amylyx Pharmaceuticals	$87.37 million	46.80	-$144.74 million	($1.43)	-25.66

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

Profitability

This table compares Alkermes and Amylyx Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alkermes	3.96%	4.15%	2.19%
Amylyx Pharmaceuticals	N/A	-52.92%	-48.53%

Summary

Alkermes beats Amylyx Pharmaceuticals on 10 of the 15 factors compared between the two stocks.

About Alkermes

Alkermes plc, a biopharmaceutical company, researches, develops, and commercializes pharmaceutical products to address unmet medical needs of patients in therapeutic areas in the United States, Ireland, and internationally. It has a portfolio of proprietary commercial products for the treatment of alcohol dependence, opioid dependence, schizophrenia and bipolar I disorder and a pipeline of clinical and preclinical product candidates in development for neurological disorders. Its marketed products include ARISTADA, an intramuscular injectable suspension for the treatment of schizophrenia; ARISTADA INITIO for the treatment of schizophrenia in adults; VIVITROL for the treatment of alcohol and prevention of opioid dependence; and LYBALVI, an oral atypical antipsychotic drug candidate for the treatment of adults with schizophrenia and bipolar I disorder. It has collaboration agreements primarily with Janssen Pharmaceutica N.V., Janssen Pharmaceutica Inc, and Janssen Pharmaceutica International. The company also offers proprietary technology platforms to third parties to enable them to develop, commercialize, and manufacture products. Alkermes plc was founded in 1987 and is headquartered in Dublin, Ireland.

About Amylyx Pharmaceuticals

Amylyx Pharmaceuticals, Inc is a biopharmaceutical company dedicated to developing treatments for rare and debilitating neurological diseases. Founded in 2013 and headquartered in Cambridge, Massachusetts, the company focuses on leveraging novel approaches to target cellular pathways implicated in neurodegeneration. Amylyx’s research platform centers on small-molecule therapies designed to protect neurons and support cellular health in patients with conditions that currently have limited or no disease-modifying treatment options.