Financial Review: Emmaus Life Sciences (NASDAQ:EMMA) versus Catasys (NASDAQ:CATS)

Emmaus Life Sciences (NASDAQ:EMMA) and Catasys (NASDAQ:CATS) are both small-cap medical companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, earnings, valuation and dividends.

Risk and Volatility

Emmaus Life Sciences has a beta of 2.86, suggesting that its stock price is 186% more volatile than the S&P 500. Comparatively, Catasys has a beta of 1.61, suggesting that its stock price is 61% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Emmaus Life Sciences and Catasys, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emmaus Life Sciences 0 0 0 0 N/A
Catasys 0 0 3 0 3.00

Catasys has a consensus target price of $21.00, suggesting a potential upside of 35.31%. Given Catasys’ higher possible upside, analysts clearly believe Catasys is more favorable than Emmaus Life Sciences.

Earnings and Valuation

This table compares Emmaus Life Sciences and Catasys’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emmaus Life Sciences $1.32 million 121.18 -$9.59 million ($11.16) -0.30
Catasys $15.18 million 16.92 -$14.21 million ($0.89) -17.44

Emmaus Life Sciences has higher earnings, but lower revenue than Catasys. Catasys is trading at a lower price-to-earnings ratio than Emmaus Life Sciences, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

0.1% of Emmaus Life Sciences shares are owned by institutional investors. Comparatively, 17.3% of Catasys shares are owned by institutional investors. 36.9% of Emmaus Life Sciences shares are owned by insiders. Comparatively, 60.8% of Catasys shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Emmaus Life Sciences and Catasys’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emmaus Life Sciences -489.28% -547.81% -224.45%
Catasys -58.01% N/A -149.25%

Summary

Catasys beats Emmaus Life Sciences on 9 of the 13 factors compared between the two stocks.

About Emmaus Life Sciences

Emmaus Life Sciences, Inc. engages in the discovery, development, and commercialization of treatments and therapies primarily for rare and orphan diseases in the United States and internationally. It provides Endari, which is L-glutamine oral powder to reduce the acute complications of sickle cell disease in adult and pediatric patients five years of age and older; NutreStore L-glutamine powder; and AminoPure, a nutritional supplement. The company also develops therapeutic products based on cell sheet technology for the treatment of corneal diseases. In addition, it focuses on developing pharmaceutical-grade L-glutamine oral powder for diverticulosis. The company was formerly known as Emmaus Holdings, Inc. and changed its name to Emmaus Life Sciences, Inc. in September 2011. Emmaus Life Sciences, Inc. was founded in 2000 and is headquartered in Torrance, California.

About Catasys

Catasys, Inc. provides big data predictive analytics, artificial intelligence and telehealth, combined with human intervention services to health plans and other third party payors. It offers OnTrak solution to improve treatment outcomes and lower the utilization of medical and behavioral health plan services. The company's OnTrak solution includes medical and psychosocial interventions; and a proprietary Web based clinical information platform and database, psychosocial programs, and integrated care coaching services. Its OnTrak solution combines medical and psychosocial treatments with elements of traditional disease management, case management, and ongoing member support to help organizations treat and manage populations struggling with substance dependence, depression, and anxiety to improve their health and thereby decrease their health care costs. Catasys, Inc.'s OnTrak solution includes various components, such as identification of impactable members, member engagement, enrollment/referral, provider network, outpatient medical treatment, outpatient psychosocial treatment, care coaching, monitoring and reporting, and proprietary Web-based clinical information platform. The company was formerly known as Hythiam, Inc. and changed its name to Catasys, Inc. in March 2011. Catasys, Inc. was founded in 2000 and is based in Los Angeles, California.

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