Head-To-Head Review: Pulmatrix (NASDAQ:PULM) versus Sage Therapeutics (NASDAQ:SAGE)

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

Analyst Recommendations

This is a summary of current recommendations and price targets for Pulmatrix and Sage Therapeutics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pulmatrix	0	0	0	0	N/A
Sage Therapeutics	2	17	1	0	1.95

Sage Therapeutics has a consensus target price of $13.76, suggesting a potential upside of 102.12%. Given Sage Therapeutics’ higher possible upside, analysts plainly believe Sage Therapeutics is more favorable than Pulmatrix.

Profitability

This table compares Pulmatrix and Sage Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pulmatrix	-95.18%	-46.86%	-28.14%
Sage Therapeutics	-458.30%	-55.87%	-50.00%

Risk & Volatility

Pulmatrix has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, Sage Therapeutics has a beta of 0.91, indicating that its stock price is 9% less volatile than the S&P 500.

Valuation & Earnings

This table compares Pulmatrix and Sage Therapeutics”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pulmatrix	$7.30 million	1.06	-$14.12 million	($2.96)	-0.71
Sage Therapeutics	$86.46 million	4.81	-$541.49 million	($7.42)	-0.92

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

Insider and Institutional Ownership

11.8% of Pulmatrix shares are held by institutional investors. Comparatively, 99.2% of Sage Therapeutics shares are held by institutional investors. 3.6% of Pulmatrix shares are held by company insiders. Comparatively, 5.5% of Sage Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Pulmatrix beats Sage Therapeutics on 7 of the 13 factors compared between the two stocks.

About Pulmatrix

Pulmatrix, Inc., a clinical stage biotechnology company, focused on development of novel inhaled therapeutic products to prevent and treat respiratory and other diseases with unmet medical needs in the United States. The company offers iSPERSE, an engineered dry powder delivery platform, which enables delivery of small or large molecule drugs to the lungs by inhalation for local or systemic applications. It engages in developing PUR1800, a narrow spectrum kinase inhibitor completed Phase 1b clinical trials for the treatment of acute exacerbations in chronic obstructive pulmonary disease; PUR1900 for the treatment of allergic bronchopulmonary aspergillosis in patients with asthma and cystic fibrosis; and PUR3100, an iSPERSE formulation of dihydroergotamine which is in Phase 1 for the treatment of acute migraine. It has a license agreement with RespiVert Ltd. for access to a portfolio of kinase inhibitor drug candidates. The company was founded in 2003 and is headquartered in Bedford, Massachusetts.

About Sage Therapeutics

Sage Therapeutics, Inc., a biopharmaceutical company, develops and commercializes brain health medicines. Its product candidates include ZULRESSO, a CIV injection for the treatment of postpartum depression (PPD) in adults; and ZURZUVAE, a neuroactive steroid, a positive allosteric modulator of GABAA receptors, targeting both synaptic and extrasynaptic GABAA receptors, for the treatment of postpartum depression. Its product pipeline also comprises SAGE-324, a compound that is in Phase II clinical trial to treat essential tremors, as well as has completed Phase I clinical trial for epilepsy and Parkinson's diseases; and SAGE-718, an oxysterol-based positive allosteric modulator of the NMDA receptor, which is in Phase II clinical trial for the treatment of depression, Huntington's disease, Parkinson's diseases, Alzheimer's disease, attention deficit hyperactivity disorder, schizophrenia, and neuropathic pain. The company has a strategic collaboration with Shionogi & Co., Ltd. for the development and commercialization of zuranolone in Japan, Taiwan, and South Korea; and a collaboration and license agreement with Biogen MA Inc. to jointly develop and commercialize SAGE-217 and SAGE-324 products. The company was formerly known as Sterogen Biopharma, Inc. and changed its name to Sage Therapeutics, Inc. in September 2011. Sage Therapeutics, Inc. was incorporated in 2010 and is headquartered in Cambridge, Massachusetts.