Analyzing Egalet (EGLT) and Edge Therapeutics (EDGE)

Egalet (NASDAQ: EGLT) and Edge Therapeutics (NASDAQ:EDGE) are both small-cap healthcare companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, analyst recommendations and profitability.

Institutional and Insider Ownership

54.1% of Egalet shares are held by institutional investors. Comparatively, 50.3% of Edge Therapeutics shares are held by institutional investors. 3.8% of Egalet shares are held by insiders. Comparatively, 36.2% of Edge Therapeutics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Egalet and Edge Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Egalet -376.62% N/A -73.83%
Edge Therapeutics N/A -56.88% -43.74%

Analyst Ratings

This is a summary of recent ratings for Egalet and Edge Therapeutics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Egalet 0 2 3 0 2.60
Edge Therapeutics 0 1 1 0 2.50

Egalet currently has a consensus price target of $6.20, indicating a potential upside of 496.15%. Edge Therapeutics has a consensus price target of $25.50, indicating a potential upside of 136.77%. Given Egalet’s stronger consensus rating and higher probable upside, analysts plainly believe Egalet is more favorable than Edge Therapeutics.

Valuation & Earnings

This table compares Egalet and Edge Therapeutics’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Egalet $16.96 million 2.82 -$90.63 million ($3.39) -0.31
Edge Therapeutics N/A N/A -$38.82 million ($1.56) -6.90

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

Summary

Egalet beats Edge Therapeutics on 7 of the 12 factors compared between the two stocks.

Egalet Company Profile

Egalet Corporation is a specialty pharmaceutical company. The Company is engaged in developing, manufacturing and commercializing treatments for pain and other conditions. The Company’s products include OXAYDO and SPRIX Nasal Spray. The Company is developing two late-stage product candidates, ARYMO ER and Egalet-002 using Guardian Technology. The Company’s product SPRIX Nasal Spray, which contains ketorolac tromethamine is a non-steroidal anti-inflammatory drug (NSAID) indicated in adult patients for the short-term management of moderate to moderately severe pain that requires analgesia at the opioid level. The Company’s product OXAYDO is an approved immediate-release (IR) oxycodone product formulated to deter abuse through snorting. The Company’s product candidate, ARYMO ER is an abuse-deterrent (AD), extended-release (ER), oral morphine formulation. The Company’s product candidate, Egalet-002, is an abuse-deterrent, extended-release, oral oxycodone formulation.

Edge Therapeutics Company Profile

Edge Therapeutics, Inc. is a clinical-stage biotechnology company that discovers, develops and seeks to commercialize hospital-based therapies capable of transforming treatment paradigms in the management of acute, life-threatening critical care conditions. The Company’s initial product candidates target rare, acute, life-threatening neurological and other conditions. The Company’s product candidates utilize its programmable, biodegradable polymer-based development platform (the Precisa Platform), a delivery mechanism that seeks to enable targeted and sustained drug exposure and avoid the dose-limiting side effects associated with the current standards of care. The Company’s product candidates include EG-1962 and EG-1964. EG-1962 is a polymer-based microsphere containing nimodipine suspended in a diluent of sodium hyaluronate was developed using its Precisa development platform to improve patient outcomes following aneurysmal subarachnoid hemorrhage (aSAH).

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