Critical Review: Cambrex (CBM) vs. Corium International (CORI)

Cambrex (NYSE: CBM) and Corium International (NASDAQ:CORI) are both small-cap medical companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.

Insider & Institutional Ownership

89.4% of Corium International shares are held by institutional investors. 2.5% of Cambrex shares are held by company insiders. Comparatively, 45.7% of Corium International shares are held by company 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 Cambrex and Corium International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cambrex 18.79% 23.42% 16.19%
Corium International -149.99% -612.73% -64.69%

Volatility and Risk

Cambrex has a beta of 2.26, meaning that its share price is 126% more volatile than the S&P 500. Comparatively, Corium International has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Cambrex and Corium International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cambrex 0 0 3 0 3.00
Corium International 0 0 7 0 3.00

Cambrex presently has a consensus price target of $62.33, indicating a potential upside of 27.21%. Corium International has a consensus price target of $13.17, indicating a potential upside of 21.80%. Given Cambrex’s higher probable upside, analysts plainly believe Cambrex is more favorable than Corium International.

Valuation and Earnings

This table compares Cambrex and Corium International’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cambrex $490.64 million 3.27 $81.67 million $3.00 16.33
Corium International $31.86 million 12.22 -$47.79 million ($1.67) -6.47

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

Summary

Cambrex beats Corium International on 8 of the 12 factors compared between the two stocks.

About Cambrex

Cambrex Corporation (Cambrex) is a life sciences company. It provides products and services for the development and commercialization of generic therapeutics. It operates through four segments, which are manufacturing facilities that have been aggregated as a single segment. Its manufacturing facilities are owned by the subsidiaries, including Cambrex Charles City, Inc., Cambrex Karlskoga AB and Cambrex Profarmaco Milano S.r.l. Its products consist of active pharmaceutical ingredients (APIs) and pharmaceutical intermediates. It delivers services, such as custom organic synthesis and process development; current good manufacturing practices (cGMP) manufacturing of API and intermediates from grams to hundreds of kilograms; cGMP analytical services; controlled substance research and development (R&D) and manufacture, Schedule II-V, and contract research. It has API R&D and cGMP facilities in the United States and Europe. It supplies over 90 generic APIs.

About Corium International

Corium International, Inc. is a commercial-stage biopharmaceutical company focused on the development, manufacture and commercialization of specialty pharmaceutical products. As of September 30, 2016, the Company had multiple programs in preclinical and clinical development focused primarily on the treatment of neurological disorders, with two lead programs in Alzheimer’s disease. The Company has two transdermal platforms: Corplex for small molecules and MicroCor, a biodegradable microstructure technology for small molecules and biologics, including vaccines, peptides and proteins. Its late-stage pipeline includes a contraceptive patch, which has completed Phase III trials, and additional transdermal products that are being developed with other partners. Its products include Clonidine TDS, Fentanyl TDS and Crest Whitestrips. Its pipeline products include Twirla, Corplex Donepezil and Corplex Memantine, Donepezil, Corplex Ropinerole, MicroCor hPTH(1-34) and Motion Sickness Patch.

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