Critical Analysis: Prime Medicine (NYSE:PRME) and Vigil Neuroscience (NASDAQ:VIGL)

Vigil Neuroscience (NASDAQ:VIGL) and Prime Medicine (NYSE:PRME) are both small-cap medical companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Insider & Institutional Ownership

83.6% of Vigil Neuroscience shares are held by institutional investors. Comparatively, 70.4% of Prime Medicine shares are held by institutional investors. 18.0% of Vigil Neuroscience shares are held by insiders. Comparatively, 23.5% of Prime Medicine shares are held 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 Vigil Neuroscience and Prime Medicine’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vigil Neuroscience	N/A	-83.89%	-65.34%
Prime Medicine	N/A	-107.87%	-74.97%

Earnings and Valuation

This table compares Vigil Neuroscience and Prime Medicine”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vigil Neuroscience	N/A	N/A	-$82.64 million	($2.05)	-3.84
Prime Medicine	$3.85 million	41.99	-$198.13 million	($1.61)	-0.76

Vigil Neuroscience has higher earnings, but lower revenue than Prime Medicine. Vigil Neuroscience is trading at a lower price-to-earnings ratio than Prime Medicine, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for Vigil Neuroscience and Prime Medicine, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vigil Neuroscience	0	3	2	0	2.40
Prime Medicine	0	2	4	1	2.86

Vigil Neuroscience currently has a consensus price target of $15.00, suggesting a potential upside of 90.36%. Prime Medicine has a consensus price target of $11.80, suggesting a potential upside of 859.35%. Given Prime Medicine’s stronger consensus rating and higher possible upside, analysts plainly believe Prime Medicine is more favorable than Vigil Neuroscience.

Risk & Volatility

Vigil Neuroscience has a beta of 1.9, indicating that its stock price is 90% more volatile than the S&P 500. Comparatively, Prime Medicine has a beta of 1.9, indicating that its stock price is 90% more volatile than the S&P 500.

Summary

Prime Medicine beats Vigil Neuroscience on 8 of the 12 factors compared between the two stocks.

About Vigil Neuroscience

Vigil Neuroscience, Inc., a clinical-stage biotechnology company, focuses on developing treatments for rare and common neurodegenerative diseases by restoring the vigilance of microglia, the sentinel immune cells of the brain. Its lead candidate is VGL101(Iluzanebart), a human monoclonal antibody agonist targeting human triggering receptor expressed on myeloid cells 2 and is in a Phase 2 trial in patients with adult-onset leukoencephalopathy with axonal spheroids and pigmented glia (ALSP), a rare and fatal neurodegenerative disease. The company is also developing VG-3927, an orally-available small molecule TREM2 agonist to treat common neurodegenerative diseases associated with microglial dysfunction, with an initial focus on Alzheimer’s disease in genetically defined subpopulations, which is being evaluated in a Phase 1 clinical trial. It has license agreement with Amgen Inc. to commercially develop, manufacture, use, distribute, and sell therapeutic products containing compounds that bind to TREM2. The company was incorporated in 2020 and is headquartered in Watertown, Massachusetts.

About Prime Medicine

Prime Medicine, Inc., a biotechnology company, delivers genetic therapies to address the spectrum of diseases by deploying gene editing technology. The company offers Prime Editors with a Prime Editor protein, comprising a fusion between a Cas protein and a reverse transcriptase enzyme; and a pegRNA, which targets the Prime Editor to a specific genomic location and provides a template for making the desired edit to the target DNA sequence. It has a research collaboration with Cimeio Therapeutics to develop Prime Edited Shielded-Cell & Immunotherapy Pairs for genetic diseases, acute myeloid leukemia, and myelodysplastic syndrome. The company was incorporated in 2019 and is based in Cambridge, Massachusetts.