Critical Analysis: Erytech Pharma (NASDAQ:ERYP) and Gritstone Oncology (NASDAQ:GRTS)

Erytech Pharma (NASDAQ:ERYP) and Gritstone Oncology (NASDAQ:GRTS) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Insider & Institutional Ownership

8.2% of Erytech Pharma shares are held by institutional investors. Comparatively, 57.7% of Gritstone Oncology shares are held by institutional investors. 38.0% of Gritstone Oncology shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Erytech Pharma and Gritstone Oncology’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Erytech Pharma N/A N/A -$45.14 million $2.44 2.32
Gritstone Oncology $1.19 million 294.31 -$64.78 million ($7.26) -1.35

Erytech Pharma has higher earnings, but lower revenue than Gritstone Oncology. Gritstone Oncology is trading at a lower price-to-earnings ratio than Erytech Pharma, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Erytech Pharma and Gritstone Oncology, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Erytech Pharma 0 0 1 0 3.00
Gritstone Oncology 0 1 7 0 2.88

Gritstone Oncology has a consensus target price of $21.33, indicating a potential upside of 117.91%. Given Gritstone Oncology’s higher possible upside, analysts clearly believe Gritstone Oncology is more favorable than Erytech Pharma.

Profitability

This table compares Erytech Pharma and Gritstone Oncology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Erytech Pharma N/A N/A N/A
Gritstone Oncology -2,038.71% -83.79% -42.53%

Summary

Erytech Pharma beats Gritstone Oncology on 7 of the 12 factors compared between the two stocks.

About Erytech Pharma

ERYTECH Pharma S.A., a biopharmaceutical company, develops therapies for severe forms of cancer and orphan diseases. It is developing a pipeline of product candidates targeting solid and liquid tumors for patients with high unmet medical needs. The company's lead product candidate is eryaspase, which is used for the treatment of severe solid tumors, including pancreatic cancer and in acute lymphoblastic leukemia. It is preparing for the launch of a pivotal Phase III clinical trial of eryaspase in the United States and Europe. ERYTECH Pharma S.A. has research collaborations with the Fox Chase Cancer Center to advance the preclinical development of erymethionase for the treatment of homocystinuria and with Queen's University of Canada to advance the preclinical development of eryminase for the treatment of arginase-1-deficiency. ERYTECH Pharma S.A. was founded in 2004 and is based in Lyon, France.

About Gritstone Oncology

Gritstone Oncology Inc., an immuno-oncology company, engages in developing tumor-specific cancer immunotherapies to fight various cancer types. Its lead product candidate is GRANITE-001, which is in Phase I/II clinical trial for the treatment of solid tumors, including metastatic non-small cell lung cancer, as well as gastroesophageal, bladder and microsatellite stable, and colorectal cancers. Gritstone Oncology Inc. has a strategic collaboration with bluebird bio, Inc. The company was founded in 2015 and is headquartered in Emeryville, California.

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