Oramed Pharmaceuticals (NASDAQ:ORMP) and Retrophin (NASDAQ:RTRX) are both small-cap medical companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Institutional and Insider Ownership

2.6% of Oramed Pharmaceuticals shares are held by institutional investors. 20.5% of Oramed Pharmaceuticals shares are held by company insiders. Comparatively, 4.6% of Retrophin shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Oramed Pharmaceuticals has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500. Comparatively, Retrophin has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500.

Earnings & Valuation

This table compares Oramed Pharmaceuticals and Retrophin’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Oramed Pharmaceuticals $2.70 million 31.12 -$14.35 million $0.82 4.40
Retrophin $175.34 million 4.86 -$146.43 million ($3.46) -5.70

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

Profitability

This table compares Oramed Pharmaceuticals and Retrophin’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Oramed Pharmaceuticals -295.94% -43.25% -24.11%
Retrophin -57.01% -43.15% -17.16%

Analyst Recommendations

This is a summary of current ratings and target prices for Oramed Pharmaceuticals and Retrophin, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Oramed Pharmaceuticals 0 0 3 0 3.00
Retrophin 0 1 7 0 2.88

Oramed Pharmaceuticals currently has a consensus target price of $9.50, suggesting a potential upside of 163.16%. Retrophin has a consensus target price of $28.00, suggesting a potential upside of 41.92%. Given Oramed Pharmaceuticals’ stronger consensus rating and higher possible upside, equities analysts plainly believe Oramed Pharmaceuticals is more favorable than Retrophin.

Summary

Oramed Pharmaceuticals beats Retrophin on 9 of the 14 factors compared between the two stocks.

About Oramed Pharmaceuticals

Oramed Pharmaceuticals Inc. engages in the research and development of pharmaceutical solutions for the use of orally ingestible capsules or pills for delivery of polypeptides. Its product portfolio includes ORMD-0801, an oral insulin capsule for the treatment of diabetes; and ORMD-0901, an oral glucagon-like peptide-1 analog capsule for the treatment of type 2 diabetes. It is also developing a weight loss treatment in the form of an oral leptin capsule. The company was formerly known as Integrated Security Technologies, Inc. and changed its name to Oramed Pharmaceuticals Inc. in April 2006. Oramed Pharmaceuticals Inc. was founded in 2002 and is based in New York, New York.

About Retrophin

Retrophin, Inc., a biopharmaceutical company, focuses on the identification, development, acquisition, and commercialization of therapies for the treatment of rare diseases. Its marketed products include Chenodal, a synthetic oral form of chenodeoxycholic acid for the treatment of radiolucent stones in well-opacifying gallbladders; Cholbam, a cholic acid capsule to treat pediatric and adult patients with bile acid synthesis disorders due to single enzyme defects, as well as for adjunctive treatment of patients with peroxisomal disorders; and Thiola, a tiopronin tablet for the treatment of cystinuria. The company's product candidates also consist of Fosmetpantotenate, a novel small molecule that is in Phase III clinical trial to treat pantothenate kinase-associated neurodegeneration; Sparsentan, which is in Phase III clinical trial for the treatment of focal segmental glomerulosclerosis and immunoglobulin A nephropathy; CNSA-001, an orally bioavailable proprietary form of sepiapterin that is in phase II clinical trial for the treatment of phenylketonuria; and liquid ursodeoxycholic acid, a liquid formulation of ursodeoxycholic acid for the treatment of primary biliary cholangitis. Retrophin, Inc. was founded in 2011 and is headquartered in San Diego, California.

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