Financial Review: Generation Bio (NASDAQ:GBIO) & Akebia Therapeutics (NASDAQ:AKBA)

Generation Bio (NASDAQ:GBIOGet Rating) and Akebia Therapeutics (NASDAQ:AKBAGet Rating) are both small-cap medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, valuation, earnings and dividends.

Valuation and Earnings

This table compares Generation Bio and Akebia Therapeutics’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Generation Bio N/A N/A -$119.15 million ($2.34) -2.43
Akebia Therapeutics $213.58 million 0.23 -$282.84 million ($0.88) -0.30

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

Volatility & Risk

Generation Bio has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500. Comparatively, Akebia Therapeutics has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500.

Insider & Institutional Ownership

93.9% of Generation Bio shares are held by institutional investors. Comparatively, 31.6% of Akebia Therapeutics shares are held by institutional investors. 20.7% of Generation Bio shares are held by insiders. Comparatively, 2.9% of Akebia Therapeutics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Generation Bio and Akebia Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Generation Bio N/A -39.52% -31.03%
Akebia Therapeutics -52.42% -315.92% -27.97%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Generation Bio and Akebia Therapeutics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Generation Bio 0 2 5 0 2.71
Akebia Therapeutics 0 6 0 0 2.00

Generation Bio presently has a consensus target price of $16.75, indicating a potential upside of 194.89%. Akebia Therapeutics has a consensus target price of $1.75, indicating a potential upside of 569.47%. Given Akebia Therapeutics’ higher possible upside, analysts clearly believe Akebia Therapeutics is more favorable than Generation Bio.

Summary

Generation Bio beats Akebia Therapeutics on 8 of the 13 factors compared between the two stocks.

About Generation Bio

(Get Rating)

Generation Bio Co., a genetic medicines company, develops therapies for the treatment of rare and prevalent diseases. The company provides a portfolio of programs, including programs for rare and prevalent diseases of the liver and retina. It also focuses on the diseases of skeletal muscle, central nervous system, and oncology. The company was formerly known as Torus Therapeutics, Inc. and changed its name to Generation Bio Co. in November 2017. Generation Bio Co. was incorporated in 2016 and is headquartered in Cambridge, Massachusetts.

About Akebia Therapeutics

(Get Rating)

Akebia Therapeutics, Inc., a biopharmaceutical company, focuses on the development and commercialization of therapeutics for patients with kidney diseases. The company's lead product investigational product candidate is vadadustat, an oral therapy, which is in Phase III development for the treatment of anemia due to chronic kidney disease (CKD) in dialysis-dependent and non-dialysis dependent adult patients. It also offers Auryxia, a ferric citrate that is used to control the serum phosphorus levels in adult patients with DD-CKD on dialysis; and the treatment of iron deficiency anemia in adult patients with CKD not on dialysis. Akebia Therapeutics, Inc. has collaboration agreements with Otsuka Pharmaceutical Co. Ltd. for the development and commercialization of vadadustat in the United States, the European Union, Russia, China, Australia, Canada, the Middle East, and other countries; and Mitsubishi Tanabe Pharma Corporation for the development and commercialization of vadadustat in Japan and other Asian countries, as well as research and license agreement with Janssen Pharmaceutica NV for the development and commercialization of hypoxia-inducible factor prolyl hydroxylase targeted compounds worldwide. The company was incorporated in 2007 and is headquartered in Cambridge, Massachusetts.

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