Head to Head Contrast: GW Pharmaceuticals (GWPH) vs. Axsome Therapeutics (NASDAQ:AXSM)

GW Pharmaceuticals (NASDAQ: GWPH) and Axsome Therapeutics (NASDAQ:AXSM) are both medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Profitability

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This table compares GW Pharmaceuticals and Axsome Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GW Pharmaceuticals -1,357.98% -46.94% -41.00%
Axsome Therapeutics N/A -132.28% -73.69%

Volatility & Risk

GW Pharmaceuticals has a beta of 2.62, suggesting that its share price is 162% more volatile than the S&P 500. Comparatively, Axsome Therapeutics has a beta of -0.16, suggesting that its share price is 116% less volatile than the S&P 500.

Insider and Institutional Ownership

82.5% of GW Pharmaceuticals shares are held by institutional investors. Comparatively, 22.8% of Axsome Therapeutics shares are held by institutional investors. 5.5% of GW Pharmaceuticals shares are held by insiders. Comparatively, 35.2% of Axsome Therapeutics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares GW Pharmaceuticals and Axsome Therapeutics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
GW Pharmaceuticals $11.00 million 279.77 -$166.90 million ($6.95) -15.95
Axsome Therapeutics N/A N/A -$28.94 million ($1.24) -1.98

Axsome Therapeutics has lower revenue, but higher earnings than GW Pharmaceuticals. GW Pharmaceuticals is trading at a lower price-to-earnings ratio than Axsome Therapeutics, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for GW Pharmaceuticals and Axsome Therapeutics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GW Pharmaceuticals 0 1 6 0 2.86
Axsome Therapeutics 0 0 4 0 3.00

GW Pharmaceuticals currently has a consensus target price of $150.29, indicating a potential upside of 35.61%. Axsome Therapeutics has a consensus target price of $19.50, indicating a potential upside of 695.92%. Given Axsome Therapeutics’ stronger consensus rating and higher probable upside, analysts plainly believe Axsome Therapeutics is more favorable than GW Pharmaceuticals.

Summary

Axsome Therapeutics beats GW Pharmaceuticals on 7 of the 13 factors compared between the two stocks.

GW Pharmaceuticals Company Profile

GW Pharmaceuticals plc, a biopharmaceutical company, engages in discovering, developing, and commercializing cannabinoid prescription medicines using botanical extracts derived from the Cannabis plant. The company operates through three segments: Commercial, Sativex Research and Development, and Pipeline Research and Development. Its lead product is Epidiolex, an oral medicine which is in Phase III clinical development for the treatment of refractory childhood epilepsies, as well as for the treatment of Dravet syndrome, Lennox-Gastaut syndrome, tuberous sclerosis complex, and infantile spasms. The company also develops and markets Sativex, an oromucosal spray for the treatment of spasticity due to multiple sclerosis. In addition, it develops various product candidates, which are in Phase I and II clinical development for the treatment of glioma, neonatal hypoxic-ischemic encephalopathy, adult epilepsy, and schizophrenia. Further, the company has license and development agreements with Otsuka Pharmaceutical Co. Ltd.; Almirall S.A.; Bayer HealthCare AG; Ipsen Biopharm Ltd; and Neopharm Group. It primarily operates in Europe, the United States, Canada, and Asia. GW Pharmaceuticals plc was founded in 1998 and is based in Cambridge, the United Kingdom.

Axsome Therapeutics Company Profile

Axsome Therapeutics, Inc., a clinical-stage biopharmaceutical company, develops therapies for the management of central nervous system (CNS) disorders. The company's product candidates include AXS-05 that is in Phase III trial for the treatment of treatment resistant depression and Alzheimer's disease agitation; and AXS-02, which is in Phase III trial to treat complex regional pain syndrome, knee osteoarthritis related to bone marrow lesions, and chronic low back pain related to Modic changes. It is also developing AXS-06, a preclinical product candidate for CNS disorders, including chronic pain. Axsome Therapeutics, Inc. has a research collaboration agreement with Duke University for Phase 2 trial of AXS-05 in smoking cessation. The company was founded in 2012 and is based in New York, New York.

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