Critical Analysis: Corcept Therapeutics (CORT) and NewLink Genetics (NLNK)

Corcept Therapeutics (NASDAQ: CORT) and NewLink Genetics (NASDAQ:NLNK) are both small-cap medical companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, dividends, valuation, risk, institutional ownership, analyst recommendations and earnings.

Risk and Volatility

Corcept Therapeutics has a beta of 1.94, suggesting that its stock price is 94% more volatile than the S&P 500. Comparatively, NewLink Genetics has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Corcept Therapeutics and NewLink Genetics, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Corcept Therapeutics 0 1 4 0 2.80
NewLink Genetics 0 5 1 0 2.17

Corcept Therapeutics presently has a consensus price target of $26.40, suggesting a potential upside of 67.94%. NewLink Genetics has a consensus price target of $11.33, suggesting a potential upside of 138.10%. Given NewLink Genetics’ higher probable upside, analysts plainly believe NewLink Genetics is more favorable than Corcept Therapeutics.

Valuation and Earnings

This table compares Corcept Therapeutics and NewLink Genetics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Corcept Therapeutics $159.20 million 11.38 $129.12 million $0.44 35.73
NewLink Genetics $28.71 million 6.16 -$71.95 million ($2.30) -2.07

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

Profitability

This table compares Corcept Therapeutics and NewLink Genetics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Corcept Therapeutics 75.05% 46.78% 39.56%
NewLink Genetics -193.44% -55.64% -44.63%

Institutional and Insider Ownership

76.4% of Corcept Therapeutics shares are held by institutional investors. Comparatively, 53.0% of NewLink Genetics shares are held by institutional investors. 15.0% of Corcept Therapeutics shares are held by insiders. Comparatively, 12.3% of NewLink Genetics shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Corcept Therapeutics beats NewLink Genetics on 13 of the 14 factors compared between the two stocks.

Corcept Therapeutics Company Profile

Corcept Therapeutics Incorporated, a pharmaceutical company, discovers, develops, and commercializes drugs for the treatment of severe metabolic, oncologic, and psychiatric disorders in the United States. The company offers Korlym (mifepristone) tablets as a once-daily oral medication for the treatment of hyperglycemia secondary to hypercortisolism in adult patients with endogenous Cushing's syndrome, who have type 2 diabetes mellitus or glucose intolerance, and have failed surgery or are not candidates for surgery, as well as develops CLIA-validated assay to measure FKBP5 gene expression. It is developing relacorilant that is in a Phase II trial to treat patients with Cushing's syndrome; abraxane in combination with relacorilant, which is in Phase I/II open label trial to treat solid tumors; and selective cortisol modulator CORT125281 combined with Xtandi that is in open label Phase I/II trial to treat patients with metastatic castration-resistant prostate cancer. The company is also developing CORT118335 selective cortisol modulator, which is in Phase I/II open label trial for the treatment of antipsychotic-induced weight gain and non-alcoholic steatotic hepatitis. Corcept Therapeutics Incorporated was founded in 1998 and is headquartered in Menlo Park, California.

NewLink Genetics Company Profile

NewLink Genetics Corporation, a late clinical-stage immuno-oncology company, focuses on discovering and developing novel immunotherapeutic products for the treatment of patients with cancer. It is developing NLG2103, a combination of indoximod and standard of care checkpoint inhibitors, which is in Phase II clinical trial for treating patients with advanced melanoma; and Indigo301, a combination of indoximod with a checkpoint inhibitor that is in Phase III clinical trial for treating patients with advanced unresectable or metastatic melanoma, as well as combination of indoximod with other cancer therapeutics for patients with melanoma, pancreatic cancer, pediatric brain tumors, and acute myeloid leukemia. The company is also developing NLG802, a prodrug of indoximod, which has completed Phase I clinical trial; and NLG919, a clinical stage indoleamine-2, 3-dioxygenase pathway inhibitor. In addition, it is developing tergenpumatucel-L and dorgenmeltucel-L that are in Phase II clinical trials for treating patients with advanced lung cancer and melanoma; and CRLX101 and CRLX301, which are in early clinical development to treat patients with advanced solid malignancies. The company has strategic collaboration agreement with AstraZeneca to evaluate the combination of indoximod and durvalumab, an anti-PD-L1 monoclonal antibody for treating patients with metastatic pancreatic cancer; Genentech Inc. for the development and commercialization of NLG919, as well as a research collaboration for the discovery of next generation IDO/TDO inhibitors; and Merck Sharpe and Dohme Corp. to research, develop, and commercialize rVSV G-ZEBOV GP, an Ebola vaccine product candidate. NewLink Genetics Corporation was founded in 1999 and is headquartered in Ames, Iowa.

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