Zymeworks (NYSE:ZYME) and Zomedica (OTC:ZOMDF) Critical Review

Zomedica (OTC:ZOMDF) and Zymeworks (NYSE:ZYME) are both small-cap manufacturing companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Insider & Institutional Ownership

8.9% of Zomedica shares are owned by institutional investors. Comparatively, 92.9% of Zymeworks shares are owned by institutional investors. 5.6% of Zomedica shares are owned by company insiders. Comparatively, 33.5% of Zymeworks shares are owned 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.

Profitability

This table compares Zomedica and Zymeworks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zomedica	N/A	N/A	N/A
Zymeworks	-182.75%	-23.00%	-18.04%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Zomedica and Zymeworks, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zomedica	0	0	0	0	0.00
Zymeworks	0	0	11	0	3.00

Zymeworks has a consensus target price of $32.82, indicating a potential upside of 41.64%. Given Zymeworks’ stronger consensus rating and higher possible upside, analysts plainly believe Zymeworks is more favorable than Zomedica.

Risk & Volatility

Zomedica has a beta of 1.57, indicating that its share price is 57% more volatile than the S&P 500. Comparatively, Zymeworks has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500.

Valuation and Earnings

This table compares Zomedica and Zymeworks”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zomedica	N/A	N/A	N/A	($0.10)	-1.33
Zymeworks	$134.48 million	12.89	-$118.67 million	($0.84)	-27.58

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

About Zomedica

Zomedica Corp., a veterinary health company, focuses on the unmet needs of clinical veterinarians by developing products for companion animals. The company engages in the development and commercialization of TRUFORMA platform, which offers point-of-care diagnostic products for disease states in dogs and cats; and PulseVet, provides for treatment of various musculoskeletal issues, such as broken bones, tendonitis, and torn ligaments in horses and small animals. It has collaboration agreements with Celsee, Inc. for the development and commercialization of liquid biopsy assays and related consumables for the detection of cancer in companion animals; and Seraph Biosciences, Inc. for development and markets a novel pathogen detection system. The company was formerly known as Zomedica Pharmaceuticals Corp. and changed its name to Zomedica Corp. in October 2020. Zomedica Corp. was founded in 2015 and is headquartered in Ann Arbor, Michigan.

About Zymeworks

Zymeworks Inc., a clinical-stage biopharmaceutical company, discovers, develops, and commercializes biotherapeutics for the treatment of cancer. The company’s lead product candidates include zanidatamab, a human epidermal growth factor receptor 2 (HER2) that is in Phase 1, Phase 2, and Phase 3 clinical trials, including certain ongoing pivotal clinical trials; and zanidatamab zovodotin, a HER2 -targeted antibody-drug conjugate that is in Phase 2 clinical trial for the treatment of advanced or metastatic HER2-expressing tumors. It also develops a pipeline of preclinical product candidates and discovery-stage programs in oncology, including immuno-oncology agents and other therapeutic areas. Zymeworks Inc. has strategic partnerships and collaborations with BeiGene, Ltd.; Celgene Corporation; Celgene Alpine Investment Co. LLC; GlaxoSmithKline Intellectual Property Development Limited; Daiichi Sankyo Co., Ltd.; Janssen Biotech, Inc.; LEO Pharma A/S; Iconic Therapeutics, Inc.; Merck Sharp & Dohme Research GmbH; and Atreca, Inc. Zymeworks Inc. was incorporated in 2003 and is based in Middletown, Delaware.