Cytokinetics (NASDAQ:CYTK) versus Mereo BioPharma Group (NASDAQ:MREO) Head-To-Head Analysis

Cytokinetics (NASDAQ:CYTK) and Mereo BioPharma Group (NASDAQ:MREO) are both healthcare companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Cytokinetics and Mereo BioPharma Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cytokinetics	1	1	18	0	2.85
Mereo BioPharma Group	2	3	3	0	2.12

Cytokinetics currently has a consensus target price of $103.37, suggesting a potential upside of 52.93%. Mereo BioPharma Group has a consensus target price of $1.67, suggesting a potential upside of 426.93%. Given Mereo BioPharma Group’s higher possible upside, analysts plainly believe Mereo BioPharma Group is more favorable than Cytokinetics.

Insider and Institutional Ownership

62.8% of Mereo BioPharma Group shares are owned by institutional investors. 2.6% of Cytokinetics shares are owned by insiders. Comparatively, 6.5% of Mereo BioPharma Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Cytokinetics has a beta of 0.36, suggesting that its share price is 64% less volatile than the S&P 500. Comparatively, Mereo BioPharma Group has a beta of 0.32, suggesting that its share price is 68% less volatile than the S&P 500.

Earnings and Valuation

This table compares Cytokinetics and Mereo BioPharma Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cytokinetics	$88.04 million	95.53	-$784.96 million	($7.22)	-9.36
Mereo BioPharma Group	$500,000.00	101.02	-$41.88 million	($0.04)	-7.91

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

Profitability

This table compares Cytokinetics and Mereo BioPharma Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cytokinetics	-1,321.12%	N/A	-51.01%
Mereo BioPharma Group	N/A	-74.82%	-64.28%

Summary

Mereo BioPharma Group beats Cytokinetics on 8 of the 14 factors compared between the two stocks.

About Cytokinetics

Cytokinetics, Incorporated, a late-stage biopharmaceutical company, focuses on discovering, developing, and commercializing muscle activators and inhibitors as potential treatments for debilitating diseases. The company develops small molecule drug candidates primarily engineered to impact muscle function and contractility. Its drug candidates include omecamtiv mecarbil, a novel cardiac myosin activator that is in Phase III clinical trial in patients with heart failure. The company also develops CK-136, a novel cardiac troponin activator that is in Phase I clinical trial; CK-586, a small molecule cardiac myosin inhibitor, that is in Phase I clinical trial; and aficamten, a novel cardiac myosin inhibitor, which is in Phase III clinical trial for the treatment of patients with symptomatic obstructive hypertrophic cardiomyopathy. Cytokinetics, Incorporated has a strategic alliance with Ji Xing Pharmaceuticals Limited. The company was incorporated in 1997 and is headquartered in South San Francisco, California.

About Mereo BioPharma Group

Mereo BioPharma Group plc, a biopharmaceutical company, develops and commercializes therapeutics for the treatment of oncology and rare diseases in the United Kingdom, the United States, and internationally. It develops Etigilimab (MPH-313), an antibody T-cell immunoreceptor with Ig and ITIM domains, which is in Phase 1b clinical trial for the treatment of tumors. The company is also developing Navicixizumab (OMP-305B83), which has completed Phase 1b clinical trials for the treatment of the late line ovarian cancer; Acumapimod (BCT-197), a p38 MAP kinase inhibitor that is in Phase II clinical trials to treat acute exacerbations of chronic obstructive pulmonary disease; and Leflutrozole (BGS-649), an oral aromatase inhibitor for the treatment of hypogonadotropic hypogonadism which is in Phase 2 trials. In addition, it develops rare disease product candidates, including Setrusumab (BPS-804), an antibody for the treatment of osteogenesis imperfecta; and Alvelestat (MPH-966), an oral small molecule that is in Phase II clinical trial to treat Alpha-1 anti-trypsin deficiency. The company has a license agreement with Feng Biosciences for the development and commercialization of navicixizumab; license agreement with ReproNovo for the development and commercialization of leflutrozole; licensing agreement with AstraZeneca; and license agreement with Ultragenyx Pharmaceutical Inc. to develop and commercialize setrusumab. Mereo BioPharma Group plc was incorporated in 2015 and is headquartered in London, the United Kingdom.