Albany Molecular Research (NASDAQ: AMRI) and OncoMed Pharmaceuticals (NASDAQ:OMED) are both small-cap healthcare companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Insider & Institutional Ownership

72.1% of Albany Molecular Research shares are held by institutional investors. Comparatively, 51.7% of OncoMed Pharmaceuticals shares are held by institutional investors. 14.5% of Albany Molecular Research shares are held by insiders. Comparatively, 32.8% of OncoMed Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Albany Molecular Research and OncoMed Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Albany Molecular Research -5.93% -13.39% -3.42%
OncoMed Pharmaceuticals -350.49% N/A -49.95%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Albany Molecular Research and OncoMed Pharmaceuticals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Albany Molecular Research 0 4 0 0 2.00
OncoMed Pharmaceuticals 0 6 2 0 2.25

Albany Molecular Research currently has a consensus target price of $18.00, indicating a potential downside of 17.20%. OncoMed Pharmaceuticals has a consensus target price of $6.00, indicating a potential upside of 48.88%. Given OncoMed Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts clearly believe OncoMed Pharmaceuticals is more favorable than Albany Molecular Research.

Risk & Volatility

Albany Molecular Research has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500. Comparatively, OncoMed Pharmaceuticals has a beta of 2.76, suggesting that its share price is 176% more volatile than the S&P 500.

Earnings & Valuation

This table compares Albany Molecular Research and OncoMed Pharmaceuticals’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Albany Molecular Research $680.81 million 1.33 $73.33 million ($1.80) -12.08
OncoMed Pharmaceuticals $24.55 million 6.18 -$82.33 million ($2.38) -1.69

Albany Molecular Research has higher revenue and earnings than OncoMed Pharmaceuticals. Albany Molecular Research is trading at a lower price-to-earnings ratio than OncoMed Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Summary

OncoMed Pharmaceuticals beats Albany Molecular Research on 7 of the 13 factors compared between the two stocks.

About Albany Molecular Research

Albany Molecular Research, Inc. is a contract research and manufacturing company. The Company operates through Discovery and Development Services (DDS), Active Pharmaceutical Ingredients (API), Drug Product (DP) and Fine Chemicals (FC) segments. The DDS segment includes activities, such as drug lead discovery, optimization, drug development and small scale commercial manufacturing. The API segment includes pilot to commercial scale manufacturing of active pharmaceutical ingredients and intermediates. The DP segment includes pre-formulation, formulation and process development through commercial scale production of complex liquid-filled and lyophilized sterile injectable products and ophthalmic formulations. The FC segment includes lab to commercial scale synthesis of reagents and diverse compounds. It supplies a range of services and technologies supporting the discovery and development of pharmaceutical products, the manufacturing of API and drug product for new and generic drugs.

About OncoMed Pharmaceuticals

OncoMed Pharmaceuticals, Inc. (OncoMed) is a clinical-stage biopharmaceutical company. The Company focuses on discovering and developing therapeutics that address the fundamental biology driving cancer’s growth, resistance, recurrence and metastasis. The Company’s therapeutic candidates and preclinical programs include Demcizumab (Anti-DLL4, OMP-21M18), Tarextumab (Anti-Notch2/3, OMP-59R5), Vantictumab (anti-Fzd7, OMP-18R5), Ipafricept (Fzd8-Fc, OMP-54F28), Brontictuzumab (Anti-Notch1, OMP-52M51), Navicixizumab (Anti-DLL4/VEGF Bispecific, OMP-305B83), Anti-RSPO3 (OMP-131R10), Anti-TIGIT (OMP-313M32) and GITRL-Fc trimer (OMP-336B11). Demcizumab is a humanized monoclonal antibody that inhibits Delta-like Ligand 4 (DLL4) in the Notch signaling pathway. Tarextumab is a human monoclonal antibody that binds to both the Notch2 and Notch3 receptors.

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