Contrasting Adverum Biotechnologies (ADVM) and Summit Therapeutics (SMMT)

Summit Therapeutics (NASDAQ: SMMT) and Adverum Biotechnologies (NASDAQ:ADVM) are both small-cap medical companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, valuation, dividends and profitability.

Valuation and Earnings

This table compares Summit Therapeutics and Adverum Biotechnologies’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Summit Therapeutics $2.90 million 60.51 -$28.59 million ($0.10) -126.80
Adverum Biotechnologies $1.46 million 121.85 -$113.74 million ($1.50) -2.63

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

Volatility & Risk

Summit Therapeutics has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500. Comparatively, Adverum Biotechnologies has a beta of 2.44, indicating that its share price is 144% more volatile than the S&P 500.

Institutional and Insider Ownership

29.3% of Summit Therapeutics shares are owned by institutional investors. Comparatively, 30.1% of Adverum Biotechnologies shares are owned by institutional investors. 7.8% of Adverum Biotechnologies shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings for Summit Therapeutics and Adverum Biotechnologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Summit Therapeutics 0 0 4 0 3.00
Adverum Biotechnologies 0 1 1 0 2.50

Summit Therapeutics currently has a consensus price target of $23.00, indicating a potential upside of 81.39%. Adverum Biotechnologies has a consensus price target of $4.75, indicating a potential upside of 20.25%. Given Summit Therapeutics’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Summit Therapeutics is more favorable than Adverum Biotechnologies.

Profitability

This table compares Summit Therapeutics and Adverum Biotechnologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Summit Therapeutics -0.95% -10.90% -0.57%
Adverum Biotechnologies -3,398.29% -26.60% -24.35%

Summary

Summit Therapeutics beats Adverum Biotechnologies on 9 of the 14 factors compared between the two stocks.

Summit Therapeutics Company Profile

Summit Therapeutics plc is a biopharmaceutical company, which is engaged in drug development. The Company is focused on the discovery, development and commercialization of medicines for indications for which there are no existing or only inadequate therapies. It is conducting clinical programs focused on the genetic disease Duchenne muscular dystrophy (DMD) and the infectious disease Clostridium difficile infection (CDI). Its lead DMD product candidate is ezutromid, which is an orally administered small molecule. Its lead CDI product candidate is ridinilazole, which is an orally administered small molecule antibiotic. Its Ridinilazole is in Phase II clinical trials. It has conducted over three Phase I clinical trials of ezutromid. Its DMD program is based on utrophin modulation. It has received an orphan drug designation to ezutromid for the treatment of DMD. It is also developing an earlier-stage pipeline of second and future generation utrophin modulators for the treatment of DMD.

Adverum Biotechnologies Company Profile

Adverum Biotechnologies, Inc., formerly Avalanche Biotechnologies, Inc., is a gene therapy company. The Company is engaged in discovering and developing medicines to patients suffering from chronic or debilitating disease. The Company operates and manages its business in the segment of developing and commercializing gene therapeutics. It focuses on diseases with unmet medical need, including ophthalmic diseases, such as wet age-related macular degeneration (AMD), as well as rare genetic diseases. The Company’s product candidates include AVA-101 and AVA-201 for treatment of Wet AMD; AVA-322 and AVA-323 for the treatment of Color Vision Deficiency, and AVA-311 for the treatment of Juvenile X-linked Retinoschisis. It has generated human proof-of-concept data for AVA-101 in a Phase I trial with over eight wet AMD subjects conducted at Lions Eye Institute (LEI) in Australia. It is developing AVA-322 and AVA-323 for the treatment of color vision deficiency (CVD).

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