Financial Survey: TRACON Pharmaceuticals (NASDAQ:TCON) and Cortexyme (NASDAQ:CRTX)

Cortexyme (NASDAQ:CRTX) and TRACON Pharmaceuticals (NASDAQ:TCON) are both small-cap medical companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, earnings, dividends, valuation and profitability.

Earnings & Valuation

This table compares Cortexyme and TRACON Pharmaceuticals’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cortexyme N/A N/A -$36.98 million ($1.94) -18.36
TRACON Pharmaceuticals $3.00 million 37.26 -$22.67 million ($7.47) -0.97

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

Profitability

This table compares Cortexyme and TRACON Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cortexyme N/A -37.78% -35.24%
TRACON Pharmaceuticals N/A -273.66% -84.56%

Risk and Volatility

Cortexyme has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, TRACON Pharmaceuticals has a beta of 2.02, meaning that its share price is 102% more volatile than the S&P 500.

Institutional and Insider Ownership

55.5% of Cortexyme shares are owned by institutional investors. Comparatively, 42.0% of TRACON Pharmaceuticals shares are owned by institutional investors. 19.8% of Cortexyme shares are owned by insiders. Comparatively, 23.3% of TRACON Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for Cortexyme and TRACON Pharmaceuticals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cortexyme 2 1 4 0 2.29
TRACON Pharmaceuticals 0 0 4 0 3.00

Cortexyme presently has a consensus target price of $50.00, suggesting a potential upside of 40.37%. TRACON Pharmaceuticals has a consensus target price of $16.67, suggesting a potential upside of 130.84%. Given TRACON Pharmaceuticals’ stronger consensus rating and higher probable upside, analysts clearly believe TRACON Pharmaceuticals is more favorable than Cortexyme.

Summary

TRACON Pharmaceuticals beats Cortexyme on 7 of the 11 factors compared between the two stocks.

About Cortexyme

Cortexyme, Inc., a clinical stage biopharmaceutical company, focuses on developing therapeutics for Alzheimer's disease and other degenerative disorders. Its lead drug candidate is atuzaginstat (COR388), an orally administered brain-penetrating small molecule gingipain inhibitor, which is in Phase II/III clinical trial for use in patients with mild to moderate Alzheimer's disease. Cortexyme, Inc. has a partnership with Parkinson Study Group. The company was incorporated in 2012 and is headquartered in South San Francisco, California.

About TRACON Pharmaceuticals

TRACON Pharmaceuticals, Inc., a clinical stage biopharmaceutical company, focuses on the development and commercialization of therapeutics for cancer and age-related macular degeneration and fibrotic diseases in the United States. Its lead clinical stage product include envafolimab (KN035), an investigational PD-L1 single-domain antibody for the treatment of soft tissue sarcoma. The company's clinical stage products also include TRC102, which is a small molecule that is in Phase II clinical trial for the treatment of mesothelioma, Phase I clinical trial to treat solid tumors, Phase I to treat solid tumors and lymphomas, and Phase I trial to treat lung cancer; TRC253, a small molecule, which is in Phase II clinical trial for the treatment of metastatic castration-resistant prostate cancer; and TJ004309, a CD73 antibody that is in Phase I clinical development for the treatment of solid tumors. It has collaboration and license agreements with 3D Medicines Co., Ltd. and Jiangsu Alphamab Biopharmaceuticals Co., Ltd. for the development of envafolimab; I-Mab Biopharma for the development of CD73 antibody TJ004309; Janssen Pharmaceutica N.V. for the development of TRC253; Case Western Reserve University for the development of TRC102; and cooperative research and development agreement with National Cancer Institute. The company was formerly known as Lexington Pharmaceuticals, Inc. and changed its name to TRACON Pharmaceuticals, Inc. in March 2005. TRACON Pharmaceuticals, Inc. was incorporated in 2004 and is headquartered in San Diego, California.

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