Scholar Rock (NASDAQ:SRRK) & Halozyme Therapeutics (NASDAQ:HALO) Critical Survey

Scholar Rock (NASDAQ:SRRK) and Halozyme Therapeutics (NASDAQ:HALO) are both medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Institutional & Insider Ownership

58.5% of Scholar Rock shares are held by institutional investors. Comparatively, 82.6% of Halozyme Therapeutics shares are held by institutional investors. 41.4% of Scholar Rock shares are held by insiders. Comparatively, 2.5% of Halozyme Therapeutics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Scholar Rock and Halozyme Therapeutics, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Scholar Rock 0 0 2 0 3.00
Halozyme Therapeutics 1 0 2 0 2.33

Scholar Rock presently has a consensus target price of $27.00, suggesting a potential upside of 197.36%. Halozyme Therapeutics has a consensus target price of $21.67, suggesting a potential upside of 42.03%. Given Scholar Rock’s stronger consensus rating and higher possible upside, equities analysts plainly believe Scholar Rock is more favorable than Halozyme Therapeutics.

Risk & Volatility

Scholar Rock has a beta of 0.04, suggesting that its share price is 96% less volatile than the S&P 500. Comparatively, Halozyme Therapeutics has a beta of 1.79, suggesting that its share price is 79% more volatile than the S&P 500.

Profitability

This table compares Scholar Rock and Halozyme Therapeutics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Scholar Rock N/A -45.02% -29.78%
Halozyme Therapeutics -23.53% -16.97% -9.89%

Earnings & Valuation

This table compares Scholar Rock and Halozyme Therapeutics’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Scholar Rock $380,000.00 709.20 -$49.33 million ($3.15) -2.88
Halozyme Therapeutics $151.86 million 14.70 -$80.33 million ($0.56) -27.24

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

Summary

Scholar Rock beats Halozyme Therapeutics on 7 of the 13 factors compared between the two stocks.

About Scholar Rock

Scholar Rock Holding Corporation, a biopharmaceutical company, focuses on the discovery and development of medicines for the treatment of serious diseases in which signaling by protein growth factors plays a fundamental role. Its lead antibody product candidate is SRK-015, an inhibitor of the activation of myostatin, which is in Phase I clinical trials for the treatment of spinal muscular atrophy. The company is also developing SRK-181, an inhibitor of the activation of transforming growth factor beta-1 to treat cancers resistant to checkpoint blockade therapies. In addition, it is developing a pipeline of novel product candidates for a range of serious diseases, including other neuromuscular disorders, cancer, fibrosis, and anemia. The company has a collaboration agreement with Gilead Sciences, Inc. to discover and develop specific inhibitors of transforming growth factor beta activation for the treatment of fibrotic diseases. Scholar Rock Holding Corporation was founded in 2012 and is headquartered in Cambridge, Massachusetts.

About Halozyme Therapeutics

Halozyme Therapeutics, Inc., a biotechnology company, engages in researching, developing, and commercializing novel oncology therapies in the United States, Switzerland, and internationally. Its human enzymes are used to facilitate the delivery of injected drugs and fluids, enhancing the efficacy and the convenience of other drugs or can be used to alter tissue structures for clinical benefit. The company's products are based on the Enhanze technology, a patented recombinant human hyaluronidase enzyme (rHuPH20) that enables the subcutaneous delivery of injectable biologics, such as monoclonal antibodies and other therapeutic molecules, as well as small molecules and fluids. Its pipeline include Hylenex recombinant, a formulation of rHuPH20 to facilitate subcutaneous fluid administration for achieving hydration; to enhance the dispersion and absorption of other injected drugs in subcutaneous urography; and to enhance resorption of radiopaque agents. The company also develops PEGPH20, a therapy that is in Phase III clinical trial for pancreatic ductal adenocarcinoma; in Phase Ib clinical trial for non-small cell lung cancer; in Phase Ib/II clinical trial for patients with previously treated metastatic pancreatic ductal adenocarcinoma; in Phase Ib/II clinical trial for patients with gastric cancer; and in Phase Ib/II for cholangiocarcinoma and gall bladder cancer. It has collaborations with F. Hoffmann-La Roche, Ltd.; Hoffmann-La Roche, Inc.; Baxalta US Inc.; Baxalta GmbH; Pfizer Inc.; Janssen Biotech, Inc.; AbbVie, Inc.; Eli Lilly and Company; Bristol-Myers Squibb Company; Alexion Pharma Holding; and ARGENX BVBA. The company was founded in 1998 and is headquartered in San Diego, California.

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