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

Valuation and Earnings

This table compares ObsEva and Athersys’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ObsEva N/A N/A -$30.20 million ($2.18) -4.48
Athersys $17.35 million 12.37 -$15.33 million ($0.26) -6.96

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

Profitability

This table compares ObsEva and Athersys’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ObsEva N/A -74.99% -66.38%
Athersys -746.04% -113.63% -86.25%

Insider & Institutional Ownership

35.9% of ObsEva shares are owned by institutional investors. Comparatively, 21.0% of Athersys shares are owned by institutional investors. 9.4% of Athersys shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for ObsEva and Athersys, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ObsEva 0 0 6 0 3.00
Athersys 0 0 3 0 3.00

ObsEva currently has a consensus target price of $20.33, indicating a potential upside of 108.33%. Athersys has a consensus target price of $9.50, indicating a potential upside of 424.86%. Given Athersys’ higher possible upside, analysts plainly believe Athersys is more favorable than ObsEva.

Summary

ObsEva beats Athersys on 6 of the 11 factors compared between the two stocks.

ObsEva Company Profile

Obseva SA is a Switzerland-based company active in the pharmaceutical and medical research sector. The Company develops oral compounds to treat women’s reproductive health conditions from conception to birth. Its pipeline includes three product candidates: OBE2109 is an oral gonadotropin-releasing hormone (GnRH) receptor antagonist that binds to and blocks the endogenous GnRH from activating its pituitary receptors, which reduces estrogen production by the ovaries and leads to amenorrhea. OBE001 (nolasiban) is an oral, new generation oxytocin antagonist with the potential to inhibit uterine contractions at the time of embryo transfer, thereby enhancing embryo implantation during assisted reproductive technologies (ART). BE022 is an orally active small molecule dinoprost (PGF2a) receptor antagonist.

Athersys Company Profile

Athersys, Inc. is an international biotechnology company that is focused primarily in the field of regenerative medicine. The Company’s MultiStem cell therapy, an allogeneic stem cell product, is its lead platform product and is in later-stage clinical development. Its clinical development programs are focused on treating neurological conditions, cardiovascular disease, inflammatory and immune disorders, certain pulmonary conditions and other conditions where the standard of care is limited or inadequate for many patients. In the neurological area, the Company evaluated in a completed Phase II trial, the potential for MultiStem treatment of patients with a history of neurological damage from an ischemic stroke. The Company initiated a Phase II clinical study in the United States for the administration of MultiStem cell therapy to patients with a history of an acute myocardial infarction, or AMI.

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