Analyzing Centessa Pharmaceuticals (NASDAQ:CNTA) and Merrimack Pharmaceuticals (NASDAQ:MACK)

Merrimack Pharmaceuticals (NASDAQ:MACKGet Rating) and Centessa Pharmaceuticals (NASDAQ:CNTAGet Rating) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, dividends, analyst recommendations, profitability, valuation and risk.

Analyst Ratings

This is a summary of recent recommendations and price targets for Merrimack Pharmaceuticals and Centessa Pharmaceuticals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Merrimack Pharmaceuticals 0 0 0 0 N/A
Centessa Pharmaceuticals 0 1 2 0 2.67

Centessa Pharmaceuticals has a consensus price target of $22.00, suggesting a potential upside of 335.64%. Given Centessa Pharmaceuticals’ higher possible upside, analysts clearly believe Centessa Pharmaceuticals is more favorable than Merrimack Pharmaceuticals.

Earnings and Valuation

This table compares Merrimack Pharmaceuticals and Centessa Pharmaceuticals’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Merrimack Pharmaceuticals N/A N/A -$2.45 million ($0.14) -36.07
Centessa Pharmaceuticals N/A N/A -$381.90 million ($2.38) -2.12

Merrimack Pharmaceuticals is trading at a lower price-to-earnings ratio than Centessa Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

55.9% of Merrimack Pharmaceuticals shares are owned by institutional investors. Comparatively, 95.7% of Centessa Pharmaceuticals shares are owned by institutional investors. 23.9% of Merrimack Pharmaceuticals 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.

Profitability

This table compares Merrimack Pharmaceuticals and Centessa Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Merrimack Pharmaceuticals N/A -15.97% -15.26%
Centessa Pharmaceuticals N/A -92.17% -69.23%

Summary

Merrimack Pharmaceuticals beats Centessa Pharmaceuticals on 5 of the 9 factors compared between the two stocks.

About Merrimack Pharmaceuticals (Get Rating)

Merrimack Pharmaceuticals, Inc. operates as a biopharmaceutical company. The company was incorporated in 1993 and is headquartered in Cambridge, Massachusetts.

About Centessa Pharmaceuticals (Get Rating)

Centessa Pharmaceuticals plc, a clinical-stage pharmaceutical company, discovers, develops, and delivers medicines to patients. Its registrational pipeline products include Lixivaptan, a vasopressin V2 receptor small molecule inhibitor that is in Phase III clinical development for the treatment of autosomal dominant polycystic kidney disease; and SerpinPC, an activated protein C inhibitor, which is in Phase IIa clinical development for the treatment of hemophilia A and B. The company also has emerging pipeline products under clinical proof of concept stage comprising LB101, a PD-L1xCD47 LockBody, as well as LB201, a PD-L1xCD3 LockBody, which are designed to selectively drive potent CD47 and CD3 effector function activity while avoiding systemic toxicity; ZF874, a small molecule pharmacological chaperone folding corrector of the Z variant of alpha-1-antitrypsin in Phase I clinical development for the treatment of alpha-1-antitrypsin deficiency; MGX292, a recombinant modified BMP9 replacement protein designed to overcome the deficiency in BMP9 signaling in Pulmonary Arterial Hypertension; and OX2R Agonists that are oral and intranasal selective orexin receptor 2 agonists designed to leverage structural insights and to directly target the underlying pathophysiology of orexin neuron loss in Narcolepsy Type 1. In addition, the company has exploratory pipeline products under clinical proof of concept stage containing CBS001, an anti-LIGHT antibody, which preferentially binds the inflammatory membrane form of LIGHT in inflammatory/fibrotic diseases; and CBS004, a humanized mAb specific to BDCA2, expressed exclusively on plasmacytoid dendritic cells in systemic sclerosis, systemic lupus erythematosus, and other autoimmune diseases. Centessa Pharmaceuticals plc was incorporated in 2020 and is based in Altrincham, the United Kingdom.

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