Analyzing DURECT (DRRX) & bluebird bio (BLUE)

DURECT (NASDAQ: DRRX) and bluebird bio (NASDAQ:BLUE) are both healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.

Profitability

This table compares DURECT and bluebird bio’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DURECT -62.57% -419.65% -45.77%
bluebird bio -883.18% -28.79% -22.94%

Analyst Ratings

This is a summary of recent ratings for DURECT and bluebird bio, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DURECT 0 2 1 0 2.33
bluebird bio 2 7 13 0 2.50

DURECT presently has a consensus price target of $2.67, indicating a potential upside of 164.03%. bluebird bio has a consensus price target of $159.53, indicating a potential downside of 13.93%. Given DURECT’s higher probable upside, research analysts clearly believe DURECT is more favorable than bluebird bio.

Insider & Institutional Ownership

44.7% of DURECT shares are held by institutional investors. 10.3% of DURECT shares are held by company insiders. Comparatively, 3.9% of bluebird bio shares are held 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.

Valuation & Earnings

This table compares DURECT and bluebird bio’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DURECT $14.02 million 10.70 -$34.50 million ($0.15) -6.73
bluebird bio $6.16 million 1,475.28 -$263.50 million ($7.02) -26.40

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

Risk and Volatility

DURECT has a beta of 1.69, indicating that its stock price is 69% more volatile than the S&P 500. Comparatively, bluebird bio has a beta of 2.08, indicating that its stock price is 108% more volatile than the S&P 500.

Summary

DURECT beats bluebird bio on 7 of the 13 factors compared between the two stocks.

About DURECT

Durect Corporation is a biopharmaceutical company with research and development programs. The Company’s products candidates include DUR-928, oral for metabolic/lipid disorders, and DUR-928, injectable for acute organ injuries. Its other product candidates include POSIMIR (controlled release injection of bupivacaine), REMOXY (oral controlled release oxycodone), ORADUR-ADHD, ELADUR (controlled release injection of bupivicane), Relday (risperidone), ORADUR-based opioid (hydromorphone) and SABER-based ophthalmic. The Company’s ALZET product line consists of miniature, implantable osmotic pumps and accessories used for experimental research in mice, rats and other laboratory animals. The Company also manufactures and sells osmotic pumps used in laboratory research and design; and develops and manufactures a range of standard and custom biodegradable polymers and excipients for pharmaceutical and medical device clients for use as raw materials in their products.

About bluebird bio

bluebird bio, Inc. is a clinical-stage biotechnology company. The Company is focused on developing gene therapies for severe diseases and cancer. With its lentiviral-based gene therapy and gene editing capabilities, it has built an integrated product platform with various applications in these areas. The Company’s clinical programs in severe genetic diseases include its LentiGlobin product candidate to treat transfusion-dependent b-thalassemia and to treat severe sickle cell disease (SCD) and its Lenti-D product candidate to treat cerebral adrenoleukodystrophy (CALD). Its programs in oncology focuses on developing T cell-based immunotherapies, including chimeric antigen receptor (CAR) and T cell receptor (TCR) T cell therapies. bb2121, its lead product candidate in oncology, is a CAR T cell product candidate for the treatment of multiple myeloma. It also has discovery research programs utilizing megaTALs/homing endonuclease gene editing technologies for use across its pipeline.

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