Analyzing TESARO (TSRO) & Gemphire Therapeutics (GEMP)

TESARO (NASDAQ: TSRO) and Gemphire Therapeutics (NASDAQ:GEMP) are both healthcare companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, valuation, earnings and dividends.

Profitability

This table compares TESARO and Gemphire Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TESARO -251.22% -93.39% -61.53%
Gemphire Therapeutics N/A -170.04% -120.55%

Insider & Institutional Ownership

32.2% of Gemphire Therapeutics shares are owned by institutional investors. 40.5% of TESARO shares are owned by insiders. Comparatively, 34.0% of Gemphire Therapeutics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares TESARO and Gemphire Therapeutics’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TESARO $44.82 million 71.45 -$387.47 million ($8.43) -6.99
Gemphire Therapeutics N/A N/A -$14.58 million ($2.90) -2.20

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for TESARO and Gemphire Therapeutics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TESARO 0 9 14 0 2.61
Gemphire Therapeutics 0 0 5 0 3.00

TESARO presently has a consensus target price of $148.74, indicating a potential upside of 152.57%. Gemphire Therapeutics has a consensus target price of $25.80, indicating a potential upside of 304.39%. Given Gemphire Therapeutics’ stronger consensus rating and higher probable upside, analysts clearly believe Gemphire Therapeutics is more favorable than TESARO.

Summary

Gemphire Therapeutics beats TESARO on 7 of the 12 factors compared between the two stocks.

About TESARO

TESARO, Inc. is an oncology-focused biopharmaceutical company. The Company operates through the business of developing and commercializing of oncology-focused therapeutics segment. It is developing oncology-related product candidates, including rolapitant, niraparib and the product candidates under its immuno-oncology platform. Rolapitant is a potent and long-acting neurokinin-1 receptor antagonist for the prevention of chemotherapy induced nausea and vomiting. Niraparib is an orally active and potent poly (adenosine diphosphate (ADP)-ribose) polymerase inhibitor. It has various ongoing clinical trials evaluating niraparib for the treatment of ovarian or breast cancers. It has initiated a Phase I, dose escalation study for its first immuno-oncology antibody, TSR-042, which targets Programmed cell death protein 1. It has commenced pre-clinical research for its antibody candidate targeting Lymphocyte-activation gene-3 andTSR-033. It has commenced a Phase I clinical trial of TSR-042.

About Gemphire Therapeutics

Gemphire Therapeutics Inc. is a clinical-stage biopharmaceutical company. The Company is engaged in the development and commercialization of therapeutics to treat cardiovascular and metabolic diseases. It is developing its product candidate, gemcabene (CI-1027), which is a once-daily, oral therapy for patients who are unable to achieve normal levels of low-density lipoprotein cholesterol (LDL-C) or triglycerides with approved therapies, primarily statin therapy. Gemcabene is liver-directed and inhibits apolipoprotein C-III (apoC-III) protein in the liver and may inhibit acetyl-CoA carboxylase (ACC) in the liver. Gemcabene blocks the overall production of hepatic triglycerides and cholesterol. Gemcabene has been tested as monotherapy and in combination with statins and other drugs in over 895 subjects, across approximately 18 Phase I and Phase II clinical trials. Gemcabene is used as an adjunctive therapy to reduce LDL-C, high-sensitivity C-reactive protein (hsCRP) and triglycerides.

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