Critical Review: Recursion Pharmaceuticals (NASDAQ:RXRX) vs. Atara Biotherapeutics (NASDAQ:ATRA)

Recursion Pharmaceuticals (NASDAQ:RXRX) and Atara Biotherapeutics (NASDAQ:ATRA) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Earnings & Valuation

This table compares Recursion Pharmaceuticals and Atara Biotherapeutics”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Recursion Pharmaceuticals	$48.62 million	29.87	-$328.07 million	($1.60)	-3.82
Atara Biotherapeutics	$62.39 million	0.59	-$276.13 million	($53.25)	-0.14

Atara Biotherapeutics has higher revenue and earnings than Recursion Pharmaceuticals. Recursion Pharmaceuticals is trading at a lower price-to-earnings ratio than Atara Biotherapeutics, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Recursion Pharmaceuticals and Atara Biotherapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Recursion Pharmaceuticals	-755.37%	-79.47%	-57.28%
Atara Biotherapeutics	-290.20%	N/A	-113.71%

Risk and Volatility

Recursion Pharmaceuticals has a beta of 0.8, meaning that its share price is 20% less volatile than the S&P 500. Comparatively, Atara Biotherapeutics has a beta of 0.5, meaning that its share price is 50% less volatile than the S&P 500.

Insider & Institutional Ownership

89.1% of Recursion Pharmaceuticals shares are owned by institutional investors. Comparatively, 70.9% of Atara Biotherapeutics shares are owned by institutional investors. 15.8% of Recursion Pharmaceuticals shares are owned by insiders. Comparatively, 3.7% of Atara Biotherapeutics shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for Recursion Pharmaceuticals and Atara Biotherapeutics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Recursion Pharmaceuticals	0	4	2	0	2.33
Atara Biotherapeutics	1	2	2	0	2.20

Recursion Pharmaceuticals presently has a consensus price target of $9.40, suggesting a potential upside of 53.85%. Atara Biotherapeutics has a consensus price target of $14.00, suggesting a potential upside of 82.05%. Given Atara Biotherapeutics’ higher probable upside, analysts clearly believe Atara Biotherapeutics is more favorable than Recursion Pharmaceuticals.

Summary

Recursion Pharmaceuticals beats Atara Biotherapeutics on 7 of the 13 factors compared between the two stocks.

About Recursion Pharmaceuticals

Recursion Pharmaceuticals, Inc. operates as a clinical-stage biotechnology company, engages in the decoding biology by integrating technological innovations across biology, chemistry, automation, data science, and engineering to industrialize drug discovery. The company develops REC-994, which is in Phase 2 clinical trial to treat cerebral cavernous malformation; REC-2282, which is in Phase 2/3 clinical trial for the treatment of neurofibromatosis type 2; REC-4881, which is in Phase 1b/2 clinical trial to treat familial adenomatous polyposis; REC-3964, which is in Phase 1 clinical trial to treat Clostridioides difficile infection; and REC-4881, which is in Phase 2 clinical trial to treat AXIN1 or APC mutant cancers. Its preclinical stage product includes RBM39 to treat HR-proficient ovarian cancer. The company has collaboration and agreement with Bayer AG; the University of Utah Research Foundation; Ohio State Innovation Foundation; Roche & Genentech; and Takeda Pharmaceutical Company Limited. Recursion Pharmaceuticals, Inc. was incorporated in 2013 and is headquartered in Salt Lake City, Utah.

About Atara Biotherapeutics

Atara Biotherapeutics, Inc. develops therapies for patients with solid tumors, hematologic cancers, and autoimmune diseases in the United States. Its lead product includes Tab-cel (tabelecleucel), a T-cell immunotherapy program that is in Phase 3 clinical trials for the treatment of epstein-barr virus (EBV) driven post-transplant lymphoproliferative disease, as well as nasopharyngeal carcinoma. Its CAR T immunotherapy pipeline products include ATA2271 and ATA3271 to treat mesothelin; and ATA3219 for the treatment of B-cell malignancies, as well as ATA188 that is in Phase 2 clinical trials to treat multiple sclerosis. Atara Biotherapeutics, Inc. has a license agreement with Memorial Sloan Kettering Cancer Center; license, and research and development collaboration agreement with QIMR Berghofer Medical Research Institute; and strategic collaboration with H. Lee Moffitt Cancer Center. The company was incorporated in 2012 and is headquartered in Thousand Oaks, California.