Critical Contrast: Halozyme Therapeutics (HALO) versus Sutro Biopharma (STRO)

Halozyme Therapeutics (NASDAQ:HALO) and Sutro Biopharma (NASDAQ:STRO) are both medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, institutional ownership, risk, earnings and analyst recommendations.

Insider and Institutional Ownership

83.2% of Halozyme Therapeutics shares are owned by institutional investors. Comparatively, 47.0% of Sutro Biopharma shares are owned by institutional investors. 2.5% of Halozyme Therapeutics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Halozyme Therapeutics and Sutro Biopharma’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Halozyme Therapeutics $151.86 million 15.28 -$80.33 million ($0.56) -28.52
Sutro Biopharma $38.42 million 6.19 -$35.32 million ($6.13) -1.69

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

Analyst Recommendations

This is a summary of current ratings for Halozyme Therapeutics and Sutro Biopharma, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Halozyme Therapeutics 1 2 2 0 2.20
Sutro Biopharma 0 0 4 0 3.00

Halozyme Therapeutics presently has a consensus target price of $20.40, indicating a potential upside of 27.74%. Sutro Biopharma has a consensus target price of $24.33, indicating a potential upside of 134.65%. Given Sutro Biopharma’s stronger consensus rating and higher possible upside, analysts plainly believe Sutro Biopharma is more favorable than Halozyme Therapeutics.

Profitability

This table compares Halozyme Therapeutics and Sutro Biopharma’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Halozyme Therapeutics -52.90% -31.86% -17.32%
Sutro Biopharma N/A N/A N/A

Summary

Sutro Biopharma beats Halozyme Therapeutics on 8 of the 13 factors compared between the two stocks.

Halozyme Therapeutics Company Profile

There is no company description available for Halozyme Therapeutics Inc.

Sutro Biopharma Company Profile

Sutro Biopharma, Inc. operates as clinical stage drug discovery, development, and manufacturing company. It focuses on creating protein therapeutics for cancer and autoimmune disorders through integrated cell-free protein synthesis platform, XpressCF. The company's product candidates include STRO-001, an antibody-drug conjugate (ADC) directed against the cancer target CD74 for multiple myeloma and non-Hodgkin lymphoma; and STRO-002, an ADC directed against folate receptor-alpha for patients with ovarian and endometrial cancers. It has collaboration and license agreement with Celgene Corporation to discover and develop bispecific antibodies and/or ADCs focused primarily on the field of immuno-oncology. The company was formerly known as Fundamental Applied Biology, Inc. Sutro Biopharma, Inc. was incorporated in 2003 and is headquartered in South San Francisco, California.

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