Aerie Pharmaceuticals (NASDAQ:AERI) and Cabaletta Bio (NASDAQ:CABA) are both small-cap medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, institutional ownership, profitability, analyst recommendations, earnings and risk.
Earnings and Valuation
This table compares Aerie Pharmaceuticals and Cabaletta Bio's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Aerie Pharmaceuticals | $69.89 million | 12.92 | $-199,580,000.00 | ($3.40) | -5.66 |
| Cabaletta Bio | N/A | N/A | $-16,940,000.00 | ($4.07) | -2.55 |
Cabaletta Bio has lower revenue, but higher earnings than Aerie Pharmaceuticals. Aerie Pharmaceuticals is trading at a lower price-to-earnings ratio than Cabaletta Bio, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Aerie Pharmaceuticals and Cabaletta Bio's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Aerie Pharmaceuticals | -231.05% | -135.57% | -37.23% |
| Cabaletta Bio | N/A | -22.99% | -22.38% |
Volatility & Risk
Aerie Pharmaceuticals has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Cabaletta Bio has a beta of 1.67, suggesting that its stock price is 67% more volatile than the S&P 500.
Insider & Institutional Ownership
99.9% of Aerie Pharmaceuticals shares are held by institutional investors. Comparatively, 68.0% of Cabaletta Bio shares are held by institutional investors. 9.7% of Aerie Pharmaceuticals shares are held by insiders. Comparatively, 6.5% of Cabaletta Bio shares are held 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 Recommendations
This is a summary of current recommendations and price targets for Aerie Pharmaceuticals and Cabaletta Bio, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Aerie Pharmaceuticals | 1 | 1 | 9 | 0 | 2.73 |
| Cabaletta Bio | 0 | 0 | 3 | 0 | 3.00 |
Aerie Pharmaceuticals currently has a consensus price target of $25.50, indicating a potential upside of 32.47%. Cabaletta Bio has a consensus price target of $20.3333, indicating a potential upside of 95.70%. Given Cabaletta Bio's stronger consensus rating and higher probable upside, analysts plainly believe Cabaletta Bio is more favorable than Aerie Pharmaceuticals.
Summary
Cabaletta Bio beats Aerie Pharmaceuticals on 7 of the 13 factors compared between the two stocks.
