Ligand Pharmaceuticals (NASDAQ: LGND) and Regulus Therapeutics (NASDAQ:RGLS) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.

Insider and Institutional Ownership

59.4% of Regulus Therapeutics shares are owned by institutional investors. 8.3% of Ligand Pharmaceuticals shares are owned by company insiders. Comparatively, 4.8% of Regulus Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ligand Pharmaceuticals and Regulus Therapeutics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ligand Pharmaceuticals 1 0 4 0 2.60
Regulus Therapeutics 0 5 1 0 2.17

Ligand Pharmaceuticals presently has a consensus target price of $146.60, indicating a potential upside of 12.28%. Regulus Therapeutics has a consensus target price of $2.88, indicating a potential upside of 219.44%. Given Regulus Therapeutics’ higher possible upside, analysts plainly believe Regulus Therapeutics is more favorable than Ligand Pharmaceuticals.

Earnings & Valuation

This table compares Ligand Pharmaceuticals and Regulus Therapeutics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ligand Pharmaceuticals $108.97 million 25.28 -$1.63 million $0.69 189.23
Regulus Therapeutics $1.19 million 78.63 -$81.83 million ($1.35) -0.67

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

Profitability

This table compares Ligand Pharmaceuticals and Regulus Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ligand Pharmaceuticals 12.76% 7.83% 4.64%
Regulus Therapeutics -107,606.96% -189.71% -92.92%

Risk & Volatility

Ligand Pharmaceuticals has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Regulus Therapeutics has a beta of 1.54, suggesting that its stock price is 54% more volatile than the S&P 500.

Summary

Ligand Pharmaceuticals beats Regulus Therapeutics on 9 of the 13 factors compared between the two stocks.

About Ligand Pharmaceuticals

Ligand Pharmaceuticals Incorporated (Ligand) is a biopharmaceutical company that focuses on developing and acquiring technologies that help pharmaceutical companies discover and develop medicines. The Company is involved in the development and licensing of biopharmaceutical assets. The Company employs research technologies, such as nuclear receptor assays, high throughput computer screening, formulation science, liver targeted pro-drug technologies and antibody discovery technologies to assist companies in their work toward obtaining prescription drug approvals. As of December 31, 2016, it had partnerships and license agreements with over 85 pharmaceutical and biotechnology companies, and over 140 various programs under license with it were in various stages of commercialization and development. It has contributed research and technologies for approved medicines that treat cancer, osteoporosis, fungal infections and low blood platelets, among others.

About Regulus Therapeutics

Regulus Therapeutics Inc. is a biopharmaceutical company focused on discovering and developing drugs that target microRNAs to treat a range of diseases. The Company uses its microRNA product platform to develop chemically modified, single-stranded oligonucleotides that the Company calls anti-miRs to modulate microRNAs and return diseased cells to their healthy state. The Company’s Regulus microMarkers division is focused on identifying microRNAs as biomarkers of human disease. It has a research collaboration with Biogen focused on the discovery of microRNAs as biomarkers for multiple sclerosis and has completed research for another pharmaceutical company to explore microRNAs as biomarkers for specific patient populations. The Company is developing RG-101, an N-Acetylgalactosamine (GalNAc)-conjugated anti-miR targeting miR-122; RG-012, an anti-miR targeting microRNA-21 for the treatment of Alport syndrome, and RG-125, a GalNAc-conjugated anti-miR targeting microRNA-103/107.

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