Head-To-Head Review: Ophthotech (OPHT) and Arena Pharmaceuticals (ARNA)
Ophthotech (NASDAQ:OPHT) and Arena Pharmaceuticals (NASDAQ:ARNA) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.
Risk and Volatility
Ophthotech has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Arena Pharmaceuticals has a beta of 1.77, indicating that its stock price is 77% more volatile than the S&P 500.
This is a breakdown of recent ratings and recommmendations for Ophthotech and Arena Pharmaceuticals, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ophthotech currently has a consensus target price of $4.00, suggesting a potential upside of 183.69%. Arena Pharmaceuticals has a consensus target price of $64.80, suggesting a potential upside of 47.07%. Given Ophthotech’s higher possible upside, research analysts clearly believe Ophthotech is more favorable than Arena Pharmaceuticals.
Earnings and Valuation
This table compares Ophthotech and Arena Pharmaceuticals’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ophthotech||$209.98 million||0.28||$63.09 million||($1.67)||-0.84|
|Arena Pharmaceuticals||$17.97 million||121.28||-$29.40 million||($2.95)||-14.94|
Ophthotech has higher revenue and earnings than Arena Pharmaceuticals. Arena Pharmaceuticals is trading at a lower price-to-earnings ratio than Ophthotech, indicating that it is currently the more affordable of the two stocks.
This table compares Ophthotech and Arena Pharmaceuticals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider & Institutional Ownership
45.4% of Ophthotech shares are owned by institutional investors. Comparatively, 81.0% of Arena Pharmaceuticals shares are owned by institutional investors. 3.0% of Ophthotech shares are owned by company insiders. Comparatively, 1.9% of Arena Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Ophthotech Corporation, a biopharmaceutical company, develops novel therapies to treat ophthalmic diseases, with a focus on age-related and orphan retinal diseases. The company is developing Zimura, an inhibitor of complement factor C5, for dry and wet forms of age-related macular degeneration, a disorder of the central portion of the retina known as the macula. Ophthotech Corporation has a research agreement with the University of Massachusetts Medical School to utilize the minigene therapy approach and novel gene delivery technologies to target retinal diseases. The company was founded in 2007 and is based in New York, New York.
About Arena Pharmaceuticals
Arena Pharmaceuticals, Inc., a biopharmaceutical company, focuses on providing novel medicines with pharmacology and pharmacokinetics to patients worldwide. Its investigational clinical programs include ralinepag (APD811), which is in Phase III trial to treat pulmonary arterial hypertension; etrasimod (APD334) for ulcerative colitis, and Crohn's disease, as well as for atopic dermatitis and other indications; and Olorinab (APD371), which is in Phase II trial for the treatment of gastrointestinal pain. It is also developing APD418, a calcium-independent myofilament derepressor for the treatment of decompensated heart failure. The company has collaboration agreements with United Therapeutics Corporation; Everest Medicines Limited; Axovant Sciences GmbH; Outpost Medicine LLC; CY Biotech Company Limited; Boehringer Ingelheim International GmbH; Eisai Co., Ltd.; and Eisai Inc. Arena Pharmaceuticals, Inc. was founded in 1997 and is based in San Diego, California.
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