Phathom Pharmaceuticals (NASDAQ:PHAT – Get Free Report) and Traws Pharma (NASDAQ:TRAW – Get Free Report) are both small-cap healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.
Risk & Volatility
Phathom Pharmaceuticals has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500. Comparatively, Traws Pharma has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500.
Insider and Institutional Ownership
99.0% of Phathom Pharmaceuticals shares are held by institutional investors. Comparatively, 8.0% of Traws Pharma shares are held by institutional investors. 9.3% of Phathom Pharmaceuticals shares are held by company insiders. Comparatively, 7.6% of Traws Pharma shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Phathom Pharmaceuticals | 1 | 1 | 6 | 1 | 2.78 |
| Traws Pharma | 1 | 4 | 0 | 0 | 1.80 |
Phathom Pharmaceuticals currently has a consensus target price of $21.25, suggesting a potential upside of 184.09%. Traws Pharma has a consensus target price of $1.00, suggesting a potential upside of 104.08%. Given Phathom Pharmaceuticals’ stronger consensus rating and higher possible upside, equities analysts plainly believe Phathom Pharmaceuticals is more favorable than Traws Pharma.
Profitability
This table compares Phathom Pharmaceuticals and Traws Pharma’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Phathom Pharmaceuticals | -41.34% | N/A | -20.81% |
| Traws Pharma | N/A | -23,868.92% | -165.52% |
Valuation & Earnings
This table compares Phathom Pharmaceuticals and Traws Pharma”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Phathom Pharmaceuticals | $175.11 million | 3.46 | -$221.25 million | ($1.28) | -5.84 |
| Traws Pharma | $2.79 million | 2.70 | $9.17 million | ($1.74) | -0.28 |
Traws Pharma has lower revenue, but higher earnings than Phathom Pharmaceuticals. Phathom Pharmaceuticals is trading at a lower price-to-earnings ratio than Traws Pharma, indicating that it is currently the more affordable of the two stocks.
Summary
Phathom Pharmaceuticals beats Traws Pharma on 11 of the 15 factors compared between the two stocks.
About Phathom Pharmaceuticals
Phathom Pharmaceuticals, Inc., biopharmaceutical company, focuses on developing and commercializing treatments for gastrointestinal diseases. The company has the rights in the United States, Europe, and Canada for an investigational potassium-competitive acid blocker (P-CAB) that blocks acid secretion in the stomach. It is also developing vonoprazan for the treatment of erosive gastroesophageal reflux disease; and in combination with antibiotics for the treatment of Helicobacter pylori infection. The company was incorporated in 2018 and is headquartered in Florham Park, New Jersey.
About Traws Pharma
Traws Pharma, Inc., a clinical stage biopharmaceutical company, focuses on developing small molecule oral product candidates for respiratory viral diseases and cancer. The company is developing investigational novel therapies for influenza and COVID19 that are designed to address treatment resistance, such as TRX01 (travatrelvir), a Mpro/3CL inhibitor in development for the treatment of COVID19; and TRX100 (viroxavir), an endonuclease inhibitor in development for the treatment of pandemic influenza. It is also developing narazaciclib, a multi-kinase CDK4/6 inhibitor, which is in Phase 1/2 clinical trials in patients with cancer, with or without co-administration of letrozole to define the recommended phase 2 dose for further development in endometrial cancer; and oral rigosertib, which is administered alone or in combination for investigation in various cancers. The company was formerly known as Onconova Therapeutics, Inc. and changed its name to Traws Pharma, Inc. in April 2024. Traws Pharma, Inc. was incorporated in 1998 and is headquartered in Newtown, Pennsylvania.
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