Comparing Tempest Therapeutics (NASDAQ:TPST) & Heron Therapeutics (NASDAQ:HRTX)

Heron Therapeutics (NASDAQ:HRTX) and Tempest Therapeutics (NASDAQ:TPST) are both small-cap medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, valuation, risk, dividends and institutional ownership.

Profitability

This table compares Heron Therapeutics and Tempest Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Heron Therapeutics	-8.75%	N/A	-1.95%
Tempest Therapeutics	N/A	-310.89%	-125.12%

Volatility and Risk

Heron Therapeutics has a beta of 1.28, indicating that its stock price is 28% more volatile than the S&P 500. Comparatively, Tempest Therapeutics has a beta of -2.43, indicating that its stock price is 343% less volatile than the S&P 500.

Institutional and Insider Ownership

80.0% of Heron Therapeutics shares are held by institutional investors. Comparatively, 22.5% of Tempest Therapeutics shares are held by institutional investors. 5.9% of Heron Therapeutics shares are held by company insiders. Comparatively, 6.3% of Tempest Therapeutics shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Heron Therapeutics and Tempest Therapeutics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Heron Therapeutics	$144.29 million	1.54	-$13.58 million	($0.09)	-13.50
Tempest Therapeutics	N/A	N/A	-$41.84 million	($10.05)	-0.28

Heron Therapeutics has higher revenue and earnings than Tempest Therapeutics. Heron Therapeutics is trading at a lower price-to-earnings ratio than Tempest Therapeutics, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations for Heron Therapeutics and Tempest Therapeutics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Heron Therapeutics	1	1	3	0	2.40
Tempest Therapeutics	1	2	0	0	1.67

Heron Therapeutics presently has a consensus target price of $4.50, suggesting a potential upside of 270.37%. Tempest Therapeutics has a consensus target price of $12.50, suggesting a potential upside of 340.92%. Given Tempest Therapeutics’ higher probable upside, analysts clearly believe Tempest Therapeutics is more favorable than Heron Therapeutics.

Summary

Heron Therapeutics beats Tempest Therapeutics on 9 of the 13 factors compared between the two stocks.

About Heron Therapeutics

Heron Therapeutics, Inc., a commercial-stage biotechnology company, focuses on enhancing the lives of patients by developing and commercializing therapeutic that enhances medical care. The company's product candidates utilize its proprietary Biochronomer, a drug delivery technology, which delivers therapeutic levels of a range of short-acting pharmacological agents over a period from days to weeks with a single administration. It offers SUSTOL (granisetron), an extended-release injection for the prevention of acute and delayed nausea and vomiting associated with moderately emetogenic chemotherapy, or anthracycline and cyclophosphamide combination chemotherapy regimens; and CINVANTI, an intravenous formulation of aprepitant, a substance P/neurokinin-1 receptor antagonist for the prevention of acute and delayed nausea and vomiting associated with highly emetogenic cancer chemotherapy, as well as nausea and vomiting associated with moderately emetogenic cancer chemotherapy. The company is also developing ZYNRELEF, a dual-acting local anesthetic that delivers a fixed-dose combination of the local anesthetic bupivacaine and a low dose of the nonsteroidal anti-inflammatory drug meloxicam; and APONVIE, an intravenous formulation of a substance P/neurokinin-1 receptor antagonist indicated for the prevention of postoperative nausea and vomiting in adults. The company was formerly known as A.P. Pharma, Inc. and changed its name to Heron Therapeutics, Inc. in January 2014. Heron Therapeutics, Inc. was founded in 1983 and is headquartered in San Diego, California.

About Tempest Therapeutics

Tempest Therapeutics, Inc., a clinical-stage oncology company, develops small molecule therapeutics that combine both tumor-targeted and immune-mediated mechanisms to treat various tumors. The company's two clinical programs are TPST-1495, a dual antagonist of EP2 and EP4, receptors of prostaglandin E2, which is in a Phase 1 trial to treat cancer; and TPST-1120, a selective antagonist of peroxisome proliferator-activated receptor alpha that is in a Phase 1 trial for the treatment of solid tumors. It also develops TREX-1, an enzyme that regulates cGAS/STING pathway signaling and immune recognition. Tempest Therapeutics, Inc. was incorporated in 2011 and is headquartered in Brisbane, California. Tempest Therapeutics, Inc. operates as a subsidiary of Inception Sciences, Inc.