Reviewing Prothena Corporation PLC (PRTA) and Versartis (VSAR)

Prothena Corporation PLC (NASDAQ: PRTA) and Versartis (NASDAQ:VSAR) are both medical companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Prothena Corporation PLC and Versartis, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Prothena Corporation PLC 0 0 12 0 3.00
Versartis 0 7 3 0 2.30

Prothena Corporation PLC presently has a consensus price target of $79.73, suggesting a potential upside of 28.61%. Versartis has a consensus price target of $7.22, suggesting a potential upside of 172.54%. Given Versartis’ higher possible upside, analysts plainly believe Versartis is more favorable than Prothena Corporation PLC.

Profitability

This table compares Prothena Corporation PLC and Versartis’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Prothena Corporation PLC -527.56% -33.20% -27.66%
Versartis N/A -95.78% -63.62%

Insider and Institutional Ownership

78.2% of Versartis shares are owned by institutional investors. 3.1% of Prothena Corporation PLC shares are owned by insiders. Comparatively, 10.9% of Versartis shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Prothena Corporation PLC and Versartis’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Prothena Corporation PLC $27.53 million 86.18 -$135.60 million ($4.12) -15.05
Versartis N/A N/A -$115.55 million ($3.45) -0.77

Versartis has higher revenue, but lower earnings than Prothena Corporation PLC. Prothena Corporation PLC is trading at a lower price-to-earnings ratio than Versartis, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Prothena Corporation PLC has a beta of 2.59, indicating that its share price is 159% more volatile than the S&P 500. Comparatively, Versartis has a beta of 2.44, indicating that its share price is 144% more volatile than the S&P 500.

About Prothena Corporation PLC

Prothena Corporation Public Limited Company is a global biotechnology company. The Company is focused on the discovery, development and commercialization of immunotherapies for the treatment of diseases that involve protein misfolding or cell adhesion. The Company’s clinical pipeline of antibody-based product candidates targets a range of indications, including Amyloid Light-chain (AL) amyloidosis (NEOD001), Parkinson’s disease and other related synucleinopathies (PRX002), and inflammatory diseases, including psoriasis and psoriatic arthritis (PRX003) and ATTR amyloidosis (PRX004). The Company has generated monoclonal antibodies that selectively bind to amyloidogenic (diseased) forms of the Transthyretin (TTR)-mediated amyloidosis (ATTR) protein. The Company’s pipeline also includes late discovery-stage programs for which the Company is testing the efficacy of antibodies in preclinical models of diseases related to amyloid or cell adhesion.

About Versartis

Versartis, Inc. is an endocrine-focused biopharmaceutical company. The Company is engaged in developing a long-acting form of recombinant human growth hormone, somavaratan (VRS-317), for growth hormone deficiency (GHD), an orphan disease. The Company’s first indication for somavaratan is pediatric GHD. The Company may develop somavaratan for additional growth disorders, such as idiopathic short stature (ISS), small for gestational age (SGA) and Turner Syndrome. Somavaratan is engineered using XTEN technology to extend the residence time in the bloodstream by reducing the clearance of recombinant human growth hormone (rhGH) from the body by the two primary mechanisms, kidney filtration and receptor mediated clearance.

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