Twist Bioscience (NASDAQ:TWST – Get Free Report) and Verastem (NASDAQ:VSTM – Get Free Report) are both small-cap medical companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, profitability, institutional ownership and valuation.
Profitability
This table compares Twist Bioscience and Verastem’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Twist Bioscience | -23.51% | -29.03% | -21.77% |
| Verastem | N/A | -2,003.62% | -119.85% |
Risk & Volatility
Twist Bioscience has a beta of 2.31, indicating that its stock price is 131% more volatile than the S&P 500. Comparatively, Verastem has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Twist Bioscience | 1 | 1 | 9 | 0 | 2.73 |
| Verastem | 0 | 1 | 7 | 1 | 3.00 |
Twist Bioscience currently has a consensus price target of $49.40, indicating a potential upside of 88.26%. Verastem has a consensus price target of $13.29, indicating a potential upside of 44.10%. Given Twist Bioscience’s higher possible upside, analysts plainly believe Twist Bioscience is more favorable than Verastem.
Insider and Institutional Ownership
88.4% of Verastem shares are owned by institutional investors. 3.0% of Twist Bioscience shares are owned by company insiders. Comparatively, 2.1% of Verastem shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Twist Bioscience and Verastem”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Twist Bioscience | $312.97 million | 5.06 | -$208.73 million | ($1.45) | -18.10 |
| Verastem | $10,000.00 | 56,739.88 | -$130.64 million | ($3.28) | -2.81 |
Verastem has lower revenue, but higher earnings than Twist Bioscience. Twist Bioscience is trading at a lower price-to-earnings ratio than Verastem, indicating that it is currently the more affordable of the two stocks.
Summary
Twist Bioscience beats Verastem on 8 of the 15 factors compared between the two stocks.
About Twist Bioscience
Twist Bioscience Corporation engages in the manufacture and sale of synthetic DNA-based products. The company offers synthetic genes and gene fragments used in product development for therapeutics, diagnostics, chemicals/materials, food/agriculture, data storage, and various applications within academic research by biotech, pharma, industrial chemical, and agricultural companies, as well as academic labs; Oligo pools used in targeted NGS, CRISPR gene editing, mutagenesis experiments, DNA origami, DNA computing, data storage in DNA, and other applications; and immunoglobulin G proteins for customers focused on the pursuit of drug discovery and development. It also provides NGS tools comprising library preparation kits, human exome kits, and fixed and custom panels, as well as alliance panels, primarily used within diagnostic tests for various indications, population genetics research and biomarker discovery, translational research, microbiology, and applied markets research; and methylation detection kits for cancer, and rare and inherited disease study, as well as fast hybridization and full RNA sequencing workflow solution. In addition, the company provides synthetic SARS-CoV-2 RNA reference sequences as positive controls for the development of both NGS and reverse transcription-polymerase chain reaction assays; synthetic monkeypox controls; and various respiratory viral controls, including for influenzas, respiratory syncytial virus, rhinoviruses, SARS, MERS, and coronaviruses. Further, it offers SARS-CoV-2 Research Panels, such as the Twist Respiratory Virus Panel and the Pan-Viral Research Panel, for the detection of disease in a research setting; precision DNA libraries used for antibody engineering, affinity maturation, and humanization; and antibody optimization solution to enable simultaneous optimization of multiple characteristics of a given antibody. The company was incorporated in 2013 and is headquartered in South San Francisco, California.
About Verastem
Verastem, Inc., a development-stage biopharmaceutical company, focuses on developing and commercializing drugs for the treatment of cancer in the United States. Its product candidates are Avutometinib, an orally available small molecule RAF/MEK clamp that inhibits the ras sarcoma RAF/MEK, ERK mitogen activated pathway kinase pathway which is involved in cell proliferation, migration, transformation, and survival of tumor cells; and Defactinib, an oral small molecule inhibitor of FAK and proline-rich tyrosine kinase for various solid tumors. The company is involved in clinical studies, including RAMP 301, a randomized global confirmatory trial to evaluate the combination of Avutometinib and Defactinib for the treatment of patients with recurrent low-grade serous ovarian cancer; RAMP 201, an adaptive two-part multicenter, parallel cohort, randomized open label trial to evaluate the efficacy and safety of Avutometinib and in combination with Defactinib; and FRAME, an investigation of Avutometinib and Defactinib in patients with KRAS mutant cancers and subsequent analyses; and RAMP 204 and 205. It has license agreements with Chugai Pharmaceutical Co., Ltd. for the development, commercialization, and manufacture of products containing Avutometinib; and Pfizer Inc. to research, develop, manufacture, and commercialize products containing Pfizer's inhibitors of FAK for therapeutic, diagnostic, and prophylactic uses in humans. In addition, it has a clinical collaboration agreement with Amgen, Inc. to evaluate the combination of Avutometinib with Amgen's KRAS-G12C inhibitor LUMAKRAS which in Phase 1/2 trial entitled RAMP 203; and a discovery and development collaboration with GenFleet Therapeutics to advance new programs targeting RAS pathway-driven cancers. Verastem, Inc. was incorporated in 2010 and is headquartered in Needham, Massachusetts.
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