Reviewing Sarepta Therapeutics (SRPT) and Novan (NOVN)

Sarepta Therapeutics (NASDAQ:SRPT) and Novan (NASDAQ:NOVN) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, analyst recommendations and risk.

Profitability

This table compares Sarepta Therapeutics and Novan’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sarepta Therapeutics -89.64% -19.34% -12.30%
Novan -1,061.54% -608.09% -84.09%

Valuation & Earnings

This table compares Sarepta Therapeutics and Novan’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sarepta Therapeutics $154.58 million 59.56 -$50.68 million ($1.64) -84.50
Novan $2.14 million 31.27 -$37.12 million ($2.32) -1.11

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

Insider & Institutional Ownership

90.0% of Sarepta Therapeutics shares are owned by institutional investors. Comparatively, 11.7% of Novan shares are owned by institutional investors. 7.9% of Sarepta Therapeutics shares are owned by company insiders. Comparatively, 8.8% of Novan shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Sarepta Therapeutics and Novan, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sarepta Therapeutics 0 2 23 0 2.92
Novan 0 0 2 0 3.00

Sarepta Therapeutics currently has a consensus target price of $170.30, suggesting a potential upside of 22.89%. Novan has a consensus target price of $10.00, suggesting a potential upside of 289.11%. Given Novan’s stronger consensus rating and higher probable upside, analysts plainly believe Novan is more favorable than Sarepta Therapeutics.

Volatility & Risk

Sarepta Therapeutics has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500. Comparatively, Novan has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500.

Summary

Sarepta Therapeutics beats Novan on 8 of the 14 factors compared between the two stocks.

Sarepta Therapeutics Company Profile

Sarepta Therapeutics, Inc. focuses on the discovery and development of RNA-based therapeutics, gene therapy, and other genetic medicine approaches for the treatment of rare neuromuscular diseases. The company offers EXONDYS 51, a disease-modifying therapy for the treatment of duchenne muscular dystrophy (DMD), which is a rare genetic muscle-wasting disease caused by the absence of dystrophin. It also provides Golodirsen, a product candidate that binds to exon 53 of dystrophin pre-mRNA, which results in exclusion or skipping of exon during mRNA processing in patients with genetic mutations that are amenable to exon 53 skipping; and Casimersen, a product candidate that uses phosphorodiamidate morpholino oligomer (PMO) chemistry and exon-skipping technology to skip exon 45 of the DMD gene. In addition, the company provides SRP-5051, a peptide conjugated PMO that binds to exon 51 of dystrophin pre-mRNA resulting in exclusion of exon during mRNA processing in patients with genetic mutations that are amenable to exon 51 skipping. The company has strategic alliances with Nationwide Children's Hospital for the advancement of micro-dystrophin gene therapy program under the research and license option agreement, as well as Galgt2 gene therapy program under the license agreement; and Genethon for the advancement of micro-dystrophin gene therapy program under a research and exclusive license option agreement. It also has a research and license option agreement with Duke University for the advancement of gene editing CRISPR/Cas9 technology for muscular dystrophy; and a collaboration and license agreement with Summit (Oxford) Ltd. to commercialize products in Summit's utrophin modulator pipeline. The company distributes its products through a network of specialty distributors and specialty pharmacies in the United States, as well as through distributors internationally. Sarepta Therapeutics, Inc. was founded in 1980 and is headquartered in Cambridge, Massachusetts.

Novan Company Profile

Novan, Inc., a clinical-stage biotechnology company, focuses on the development and commercialization of nitric oxide-based therapies to treat dermatological and oncovirus-mediated diseases. Its clinical stage product candidates include SB204, a topical monotherapy that is in Phase III pivotal clinical trials for the treatment of acne vulgaris; and SB206, a topical antiviral gel, which is in Phase III pivotal trials for the treatment of patients with external genital warts, and Phase II clinical trial for the treatment of molluscum contagiosum. The company's clinical stage product candidates comprise SB208, a topical antifungal gel that is in Phase II proof-of-concept trial for the treatment of athlete's foot and fungal nail infections; and SB414, a topical cream, which is in Phase Ib trial for the treatment of inflammatory skin diseases, such as psoriasis and atopic dermatitis. It has a license agreement with Sato Pharmaceutical Co., Ltd. Novan, Inc. was founded in 2006 and is headquartered in Morrisville, North Carolina.

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