Critical Review: Sangamo Therapeutics (NASDAQ:SGMO) & Equillium (NASDAQ:EQ)

Equillium (NASDAQ:EQ) and Sangamo Therapeutics (NASDAQ:SGMO) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, dividends, valuation, profitability, institutional ownership, earnings and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings and target prices for Equillium and Sangamo Therapeutics, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equillium	1	1	7	2	2.91
Sangamo Therapeutics	2	1	1	0	1.75

Equillium currently has a consensus price target of $7.57, suggesting a potential upside of 292.30%. Sangamo Therapeutics has a consensus price target of $5.50, suggesting a potential upside of 7,332.43%. Given Sangamo Therapeutics’ higher possible upside, analysts clearly believe Sangamo Therapeutics is more favorable than Equillium.

Insider and Institutional Ownership

27.1% of Equillium shares are owned by institutional investors. Comparatively, 56.9% of Sangamo Therapeutics shares are owned by institutional investors. 17.8% of Equillium shares are owned by company insiders. Comparatively, 4.1% of Sangamo Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility & Risk

Equillium has a beta of 1.81, indicating that its stock price is 81% more volatile than the S&P 500. Comparatively, Sangamo Therapeutics has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500.

Valuation and Earnings

This table compares Equillium and Sangamo Therapeutics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equillium	$41.10 million	2.98	-$22.40 million	($0.20)	-9.65
Sangamo Therapeutics	$39.55 million	0.78	-$122.93 million	($0.38)	-0.19

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

Profitability

This table compares Equillium and Sangamo Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equillium	N/A	-41.15%	-38.29%
Sangamo Therapeutics	-310.81%	-2,662.06%	-132.12%

Summary

Equillium beats Sangamo Therapeutics on 12 of the 15 factors compared between the two stocks.

About Equillium

Equillium, Inc., a clinical-stage biotechnology company, develops and sells products to treat severe autoimmune and inflammatory, or immuno-inflammatory disorders with unmet medical need. The company's lead product candidate is itolizumab (EQ001), a first-in-class monoclonal antibody that targets the immune checkpoint receptor CD6, which is in Phase III clinical trials for the treatment of acute graft-versus-host disease; completed Phase I clinical trial for the treatment of ulcerative colitis; and Phase I clinical trial for the treatment of lupus nephritis. It also develops EQ101 completed phase 1/2 for treatment of cutaneous T cell lymphoma and alopecia areata; and EQ302 to treat gastrointestinal indications. In addition, it serves dermatology, gastroenterology, rheumatology, hematology, transplant science, oncology, and pulmonology area. The company was formerly known as Attenuate Biopharmaceuticals, Inc. and changed its name to Equillium, Inc. in May 2017. Equillium, Inc. was incorporated in 2017 and is headquartered in La Jolla, California.

About Sangamo Therapeutics

Sangamo Therapeutics, Inc., a clinical-stage genomic medicine company, focuses on translating science into medicines that transform the lives of patients and families afflicted with serious diseases in the United States. The company's clinical-stage product candidates are ST-920, a gene therapy product candidate, which is in Phase 1/2 clinical study for the treatment of Fabry disease; TX200, a chimeric antigen receptor engineered regulatory T cell (CAR-Treg) therapy product candidate that is in Phase 1/2 clinical study for the prevention of immune-mediated rejection in HLA-A2 mismatched kidney transplantation; SB-525, a gene therapy product candidate, which is in Phase 3 clinical trial for the treatment of moderately severe to severe hemophilia A; BIVV003, a zinc finger nuclease gene-edited cell therapy product candidate that is in Phase 1/2 PRECIZN-1 clinical study for the treatment of sickle cell disease. Its preclinical development products focus on CAR-Treg cell therapies for autoimmune disorders and genome engineering for neurological diseases. Sangamo Therapeutics, Inc. has collaborative and strategic partnerships with Biogen MA, Inc.; Kite Pharma, Inc.; Pfizer Inc.; Sanofi S.A.; Novartis Institutes for BioMedical Research, Inc.; Shire International GmbH; Dow AgroSciences LLC; Sigma-Aldrich Corporation; Genentech, Inc.; Open Monoclonal Technology, Inc.; and California Institute for Regenerative Medicine. The company was formerly known as Sangamo BioSciences, Inc. and changed its name to Sangamo Therapeutics, Inc. in January 2017. Sangamo Therapeutics, Inc. was incorporated in 1995 and is headquartered in Richmond, California.