Sorrento Therapeutics (NASDAQ:SRNE) and Orchard Therapeutics (NASDAQ:ORTX) are both medical companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, risk, earnings, dividends and analyst recommendations.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Sorrento Therapeutics and Orchard Therapeutics, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Sorrento Therapeutics | 0 | 0 | 4 | 0 | 3.00 |
| Orchard Therapeutics | 0 | 0 | 4 | 0 | 3.00 |
Sorrento Therapeutics currently has a consensus price target of $28.75, suggesting a potential upside of 226.33%. Orchard Therapeutics has a consensus price target of $14.75, suggesting a potential upside of 115.01%. Given Sorrento Therapeutics' higher probable upside, equities analysts clearly believe Sorrento Therapeutics is more favorable than Orchard Therapeutics.
Profitability
This table compares Sorrento Therapeutics and Orchard Therapeutics' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Sorrento Therapeutics | -698.01% | -314.06% | -43.60% |
| Orchard Therapeutics | N/A | -65.65% | -47.92% |
Institutional and Insider Ownership
27.4% of Sorrento Therapeutics shares are held by institutional investors. Comparatively, 66.6% of Orchard Therapeutics shares are held by institutional investors. 3.4% of Sorrento Therapeutics shares are held by company insiders. Comparatively, 4.2% of Orchard Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Sorrento Therapeutics and Orchard Therapeutics' top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Sorrento Therapeutics | $31.43 million | 78.73 | $-292,070,000.00 | ($2.12) | -4.16 |
| Orchard Therapeutics | $2.51 million | 265.83 | $-163,420,000.00 | ($1.75) | -3.92 |
Orchard Therapeutics has lower revenue, but higher earnings than Sorrento Therapeutics. Sorrento Therapeutics is trading at a lower price-to-earnings ratio than Orchard Therapeutics, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Sorrento Therapeutics has a beta of 2.7, suggesting that its stock price is 170% more volatile than the S&P 500. Comparatively, Orchard Therapeutics has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.
Summary
Orchard Therapeutics beats Sorrento Therapeutics on 8 of the 12 factors compared between the two stocks.
