Critical Contrast: NewLink Genetics (NASDAQ:NLNK) & International Stem Cell (ISCO)

NewLink Genetics (NASDAQ:NLNK) and International Stem Cell (OTCMKTS:ISCO) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, dividends, institutional ownership, analyst recommendations, earnings and profitability.

Valuation and Earnings

This table compares NewLink Genetics and International Stem Cell’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NewLink Genetics $12.47 million 4.75 -$53.60 million ($1.44) -1.10
International Stem Cell $11.09 million 0.88 -$6.06 million ($0.33) -3.91

International Stem Cell has lower revenue, but higher earnings than NewLink Genetics. International Stem Cell is trading at a lower price-to-earnings ratio than NewLink Genetics, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares NewLink Genetics and International Stem Cell’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NewLink Genetics -429.65% -42.86% -36.75%
International Stem Cell -23.26% -123.16% -31.68%

Risk & Volatility

NewLink Genetics has a beta of 1.87, suggesting that its stock price is 87% more volatile than the S&P 500. Comparatively, International Stem Cell has a beta of -0.12, suggesting that its stock price is 112% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for NewLink Genetics and International Stem Cell, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NewLink Genetics 1 3 0 0 1.75
International Stem Cell 0 0 0 0 N/A

NewLink Genetics presently has a consensus target price of $5.00, indicating a potential upside of 214.47%. Given NewLink Genetics’ higher probable upside, research analysts clearly believe NewLink Genetics is more favorable than International Stem Cell.

Institutional & Insider Ownership

34.4% of NewLink Genetics shares are held by institutional investors. 12.7% of NewLink Genetics shares are held by company insiders. Comparatively, 83.2% of International Stem Cell shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

NewLink Genetics beats International Stem Cell on 7 of the 12 factors compared between the two stocks.

NewLink Genetics Company Profile

NewLink Genetics Corporation, a late clinical-stage immuno-oncology company, focuses on discovering and developing novel immunotherapeutic products for the treatment of patients with cancer. It is developing Indoximod, an indoleamine-2, 3-dioxygenase (IDO) pathway inhibitor that is in clinical development in combination with other cancer therapeutics for patients with diffuse intrinsic pontine glioma, pediatric brain tumors, acute myeloid leukemia, and melanoma. The company also develops NLG207 in combination with paclitaxel in recurrent ovarian, fallopian tube, or primary peritoneal cancer; NLG802, a prodrug of indoximod, which has completed Phase I clinical trial; and NLG919, a direct enzymatic inhibitor. The company has collaboration and license agreement with Genentech Inc. for the development and commercialization of NLG919, as well as a research collaboration for the discovery of next generation IDO/TDO inhibitors; and Merck Sharpe & Dohme Corp. to research, develop, and commercialize rVSV G-ZEBOV GP, an Ebola vaccine product candidate. NewLink Genetics Corporation was founded in 1999 and is headquartered in Ames, Iowa.

International Stem Cell Company Profile

International Stem Cell Corporation focuses on the development of therapeutic and biomedical products worldwide. The company's products are based on human parthenogenetic stem cells, a proprietary type of pluripotent stem cell. It develops various cell types, including neural stem cells for the treatment of Parkinson's disease and other central nervous system disorders; liver cells to treat various congenital and acquired liver diseases; and islet cells for the treatment of diabetes. The company also develops, manufactures, and markets skincare products and human cell culture products. Its human cell culture products include human skin cells and reagents for the study of skin disease, toxicology, or wound healing; human cells from the heart and blood vessels, and reagents to study cardiovascular disease and cancer; human bronchial and tracheal cell lines for the study of toxicity, cystic fibrosis, asthma, and pathogenesis; and human mammary epithelial cell lines for the study of breast cancer, three dimensional culture, and carcinogen screening. The company's human cell culture products also comprise adult stem cells and reagents for regenerative medicine; human prostate cells and specialized medium to study prostate disease; human renal and bladder cells and media to study renal and bladder diseases; human corneal cells and media for the study of corneal disease; human female reproductive system cells for the study of cellular physiology; human skeletal muscle cells for the study of biology, diabetes, insulin receptor studies, muscle metabolism, muscle tissue repair, and myotube development; and other cell culture reagents and supplements for the growth, staining, and freezing of human cells. It sells skincare products through a Website and professional channels; and human cell culture products through its sales force, OEM partners, and brand distributors. The company was founded in 2001 and is headquartered in Carlsbad, California.

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