Comparing Mesoblast (OTCMKTS:MEOBF) and Sutro Biopharma (NASDAQ:STRO)

Sutro Biopharma (NASDAQ:STRO) and Mesoblast (OTCMKTS:MEOBF) are both healthcare companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, earnings, analyst recommendations, valuation and risk.

Earnings and Valuation

This table compares Sutro Biopharma and Mesoblast”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sutro Biopharma	$102.48 million	3.46	-$191.09 million	($11.97)	-1.79
Mesoblast	N/A	N/A	N/A	($0.25)	-7.50

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

Analyst Recommendations

This is a summary of recent recommendations for Sutro Biopharma and Mesoblast, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sutro Biopharma	1	0	10	2	3.00
Mesoblast	0	0	0	0	0.00

Sutro Biopharma presently has a consensus target price of $47.30, indicating a potential upside of 121.13%. Given Sutro Biopharma’s stronger consensus rating and higher possible upside, research analysts clearly believe Sutro Biopharma is more favorable than Mesoblast.

Profitability

This table compares Sutro Biopharma and Mesoblast’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sutro Biopharma	-395.25%	N/A	-88.12%
Mesoblast	N/A	N/A	N/A

Institutional and Insider Ownership

97.0% of Sutro Biopharma shares are held by institutional investors. Comparatively, 27.4% of Mesoblast shares are held by institutional investors. 1.8% of Sutro Biopharma shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Sutro Biopharma beats Mesoblast on 8 of the 11 factors compared between the two stocks.

About Sutro Biopharma

Sutro Biopharma, Inc. operates as a clinical-stage oncology company. The company develops site-specific and novel-format antibody drug conjugates (ADCs) that enables its proprietary integrated cell-free protein synthesis platform, XpressCF and XpressCF+. Its product candidates include STRO-002, an ADC directed against folate receptor-alpha, which is in Phase II/III clinical trials for patients with ovarian and endometrial cancers; VAX-24 and Vax-31 pneumococcal conjugate vaccine candidates that is in Phase II/III clinical trials for the treatment of invasive pneumococcal disease; and MK-1484, a distinct cytokine derivative molecule that is in Phase I clinical study for the treatment of cancer. The company's pre-clinical product candidates include STRO-003, an ADC directed against an anti-receptor tyrosine kinase-like orphan receptor 1 (ROR1) for the treatment of solid tumors and hematological cancers; and STRO-004, a tissue factor (TF) targeting ADC for the treatment of TF-expressing solid tumors, including cervical, lung, and breast cancer. Sutro Biopharma, Inc. has collaboration and license agreements with Merck Sharp & Dohme Corporation to develop research programs focusing on cytokine derivatives for cancer and autoimmune disorders; Vaxcyte to discover and develop vaccine candidates for the treatment or prophylaxis of infectious diseases; Tasly Biopharmaceuticals Co., Ltd. to develop and commercialize STRO-002 in Greater China; EMD Serono to develop ADCs for multiple cancer targets; and Astellas Pharma Inc. to develop immunostimulatory ADC. The company was formerly known as Fundamental Applied Biology, Inc. Sutro Biopharma, Inc. was incorporated in 2003 and is headquartered in South San Francisco, California.

About Mesoblast

Mesoblast Limited engages in the development of regenerative medicine products in Australia, the United States, Singapore, and Switzerland. The company offers products in the areas of cardiovascular, spine orthopedic disorder, oncology, hematology, and immune-mediated and inflammatory diseases. Its proprietary regenerative medicine technology platform is based on specialized cells known as mesenchymal lineage cells. The company offers Remestemcel-L that is in Phase III clinical trials for the treatment of systemic inflammatory diseases, including steroid refractory acute graft versus host disease, acute respiratory distress syndrome, and biologic refractory inflammatory bowel disease; and Remestemcel-L, which is in Phase III clinical trials to treat chronic heart failure and chronic low back pain due to degenerative disc disease. It is also developing MPC-300-IV to treat biologic refractory rheumatoid arthritis diabetic nephropathy; and MPC-25-IC for the treatment or prevention of acute myocardial infarction. It has strategic partnerships with Tasly Pharmaceutical Group to offer MPC-150-IM for heart failure and MPC-25-IC for heart attacks in China; JCR Pharmaceuticals Co. Ltd. to treat wound healing in patients with epidermolysis bullosa; and Grünenthal to develops and commercializes cell therapy for the treatment of chronic low back pain. The company was incorporated in 2004 and is headquartered in Melbourne, Australia.