Critical Comparison: Seattle Genetics (SGEN) & Novavax (NVAX)

Seattle Genetics (NASDAQ: SGEN) and Novavax (NASDAQ:NVAX) are both medical companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, dividends, earnings, profitability and risk.

Analyst Recommendations

This is a summary of current ratings and target prices for Seattle Genetics and Novavax, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Seattle Genetics 1 11 9 0 2.38
Novavax 0 4 3 0 2.43

Seattle Genetics currently has a consensus price target of $62.20, indicating a potential upside of 7.32%. Novavax has a consensus price target of $3.43, indicating a potential upside of 206.55%. Given Novavax’s stronger consensus rating and higher probable upside, analysts clearly believe Novavax is more favorable than Seattle Genetics.

Volatility & Risk

Seattle Genetics has a beta of 2.4, indicating that its share price is 140% more volatile than the S&P 500. Comparatively, Novavax has a beta of 1.97, indicating that its share price is 97% more volatile than the S&P 500.

Insider & Institutional Ownership

97.5% of Seattle Genetics shares are held by institutional investors. Comparatively, 44.9% of Novavax shares are held by institutional investors. 34.7% of Seattle Genetics shares are held by company insiders. Comparatively, 4.0% of Novavax shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Seattle Genetics and Novavax’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Seattle Genetics $418.15 million 19.95 -$140.11 million ($0.86) -67.40
Novavax $15.35 million 22.88 -$279.96 million ($0.68) -1.65

Seattle Genetics has higher revenue and earnings than Novavax. Seattle Genetics is trading at a lower price-to-earnings ratio than Novavax, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Seattle Genetics and Novavax’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Seattle Genetics -26.53% -32.41% -24.77%
Novavax -726.35% -787.38% -52.58%

Summary

Seattle Genetics beats Novavax on 9 of the 13 factors compared between the two stocks.

Seattle Genetics Company Profile

Seattle Genetics, Inc. is a biotechnology company focused on the development and commercialization of therapies for the treatment of cancer. The Company is engaged in the development and sale of pharmaceutical products on its own behalf or in collaboration with others. The Company’s marketed product ADCETRIS, or brentuximab vedotin, is an antibody-drug conjugate (ADC). In addition to ADCETRIS, the Company’s pipeline includes other clinical-stage ADC programs, such as ASG-22ME, SGN-LIV1A, SGN-CD19A, SGN-CD19B, SGN-CD123A, SGN-352A, and ASG-15ME, as well as two immuno-oncology agents, SEA-CD40, which is based on its sugar-engineered antibody (SEA) technology, and SGN-2FF, which is a small molecule. It also has multiple preclinical and research-stage programs that employ its technologies, including SGN-CD48A and a preclinical ADC. ADCETRIS is an ADC comprising an anti-CD30 monoclonal antibody attached by a protease-cleavable linker to a microtubule disrupting agent.

Novavax Company Profile

Novavax, Inc. is a clinical-stage vaccine company focused on the discovery, development and commercialization of recombinant nanoparticle vaccines and adjuvants. The Company operates through developing recombinant vaccines segment. The Company, through its recombinant nanoparticle vaccine technology, produces vaccine candidates to respond to both known and newly emerging diseases. The Company’s product pipeline focuses on a range of infectious diseases with vaccine candidates in clinical development for respiratory syncytial virus (RSV), seasonal influenza, pandemic influenza and the Ebola virus (EBOV). The Company’s lead adjuvant for human applications, Matrix-M, is in a Phase I/II clinical trial for pandemic influenza H7N9 vaccine candidate. It is also testing Matrix-M in conjunction with its EBOV vaccine candidate in a Phase I clinical trial. It is developing additional pre-clinical stage programs in a range of infectious diseases, including Middle East respiratory syndrome (MERS).

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