Contrasting Eagle Pharmaceuticals (EGRX) & Mersana Therapeutics (MRSN)

Eagle Pharmaceuticals (NASDAQ: EGRX) and Mersana Therapeutics (NASDAQ:MRSN) are both small-cap medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.

Earnings & Valuation

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This table compares Eagle Pharmaceuticals and Mersana Therapeutics’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Eagle Pharmaceuticals $236.71 million 3.26 $51.94 million $3.37 15.43
Mersana Therapeutics $17.55 million 19.49 -$38.70 million ($3.22) -4.65

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

Insider and Institutional Ownership

75.4% of Mersana Therapeutics shares are owned by institutional investors. 19.5% of Eagle Pharmaceuticals shares are owned by 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.

Profitability

This table compares Eagle Pharmaceuticals and Mersana Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Eagle Pharmaceuticals 21.94% 34.16% 23.74%
Mersana Therapeutics N/A N/A N/A

Analyst Ratings

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

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eagle Pharmaceuticals 1 0 2 0 2.33
Mersana Therapeutics 0 1 4 0 2.80

Eagle Pharmaceuticals currently has a consensus price target of $63.33, indicating a potential upside of 21.79%. Mersana Therapeutics has a consensus price target of $26.00, indicating a potential upside of 73.68%. Given Mersana Therapeutics’ stronger consensus rating and higher probable upside, analysts plainly believe Mersana Therapeutics is more favorable than Eagle Pharmaceuticals.

Summary

Eagle Pharmaceuticals beats Mersana Therapeutics on 7 of the 12 factors compared between the two stocks.

About Eagle Pharmaceuticals

Eagle Pharmaceuticals, Inc., a specialty pharmaceutical company, focuses on developing and commercializing injectable products primarily in the critical care and oncology areas in the United States. The company offers argatroban for heparin-induced thrombocytopenia; Ryanodex for malignant hyperthermia; non-alcohol docetaxel injection, a chemotherapeutic agent for breast, non-small cell lung, prostate, head, and neck cancers/gastric adenocarcinoma; and Bendeka for chronic lymphocytic leukemia (CLL) and indolent B-cell non-Hodgkin's lymphoma (NHL). Its product candidates includes include EP-3101, (bendamustine ready-to-dilute) for CLL and indolent B-cell NHL; EP-4104, a dantrolene sodium for exertional heat stroke; EGL-4104-C-1702, dantrolene sodium for drug induced hyperthermia; EP-5101 (pemetrexed) for lung cancer and mesothelioma; and EGL-5385-C-1701 (fulvestrant) for breast cancer. Eagle Pharmaceuticals, Inc. was founded in 2007 and is headquartered in Woodcliff Lake, New Jersey.

About Mersana Therapeutics

Mersana Therapeutics, Inc. is a United States-based biotechnology company focused on discovering and developing a pipeline of antibody drug conjugates (ADCs). The Company focuses on advancing a pipeline of targeted oncology therapeutics leveraging its Fleximer immunoconjugate technology. The Fleximer platform allows it to design ADCs with specific properties and manage the drug’s chances of attacking cancers. Its product candidates include XMT-1522 and XMT-1536. The ADC therapies treat cancer patients by engineering a drug conjugate with various anti-cancer agents and controlling when, where and how those agents are released. Dolaflexin is its Fleximer antibody drug conjugation platform, which pairs the Fleximer polymer with its linker chemistries to create ADC therapies. XMT-1522 is based on its Dolaflexin platform and has over 15 auristatin molecules per antibody. XMT-1522 is in Phase I clinical trial for various indications of cancers. XMT-1536 is in pre-clinical development.

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