United Therapeutics (NASDAQ:UTHR – Get Free Report) and Akero Therapeutics (NASDAQ:AKRO – Get Free Report) are both medical companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.
Profitability
This table compares United Therapeutics and Akero Therapeutics’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| United Therapeutics | 40.87% | 18.82% | 15.61% |
| Akero Therapeutics | N/A | -29.50% | -27.23% |
Insider & Institutional Ownership
94.1% of United Therapeutics shares are owned by institutional investors. 11.9% of United Therapeutics shares are owned by company insiders. Comparatively, 7.9% of Akero Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| United Therapeutics | $2.33 billion | 6.74 | $984.80 million | $21.76 | 16.20 |
| Akero Therapeutics | N/A | N/A | -$151.76 million | ($3.20) | -8.96 |
United Therapeutics has higher revenue and earnings than Akero Therapeutics. Akero Therapeutics is trading at a lower price-to-earnings ratio than United Therapeutics, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for United Therapeutics and Akero Therapeutics, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| United Therapeutics | 1 | 3 | 10 | 0 | 2.64 |
| Akero Therapeutics | 0 | 1 | 6 | 0 | 2.86 |
United Therapeutics presently has a consensus target price of $361.33, indicating a potential upside of 2.48%. Akero Therapeutics has a consensus target price of $43.20, indicating a potential upside of 50.68%. Given Akero Therapeutics’ stronger consensus rating and higher possible upside, analysts plainly believe Akero Therapeutics is more favorable than United Therapeutics.
Risk and Volatility
United Therapeutics has a beta of 0.57, meaning that its share price is 43% less volatile than the S&P 500. Comparatively, Akero Therapeutics has a beta of -0.25, meaning that its share price is 125% less volatile than the S&P 500.
Summary
United Therapeutics beats Akero Therapeutics on 11 of the 13 factors compared between the two stocks.
About United Therapeutics
United Therapeutics Corporation, a biotechnology company, engages in the development and commercialization of products to address the unmet medical needs of patients with chronic and life-threatening diseases in the United States and internationally. The company offers Tyvaso DPI, an inhaled dry powder via pre-filled and single-use cartridges; Tyvaso, an inhaled solution via ultrasonic nebulizer; Remodulin (treprostinil) injection to treat patients with pulmonary arterial hypertension (PAH) to diminish symptoms associated with exercise; Orenitram, a tablet dosage form of treprostinil, to delay disease progression and improve exercise capacity in PAH patients; and Adcirca, an oral PDE-5 inhibitor to enhance the exercise ability in PAH patients. It also markets and sells Unituxin (dinutuximab) injection, a monoclonal antibody for treating high-risk neuroblastoma; and Remunity Pump, which contains a pump and separate controller for Remodulin. In addition, the company engages in developing RemoPro and Ralinepag for the treatment of PAH; Aurora-GT, a gene therapy product to rebuild the blood vessels in the lungs; and Nebulized Tyvaso, for the treatment of idiopathic pulmonary fibrosis, as well as xenografts, which are development-stage organ products. It has licensing and collaboration agreements with DEKA Research & Development Corp. to develop a semi-disposable system for the subcutaneous delivery of treprostinil; MannKind Corporation to develop and license treprostinil inhalation powder and the Dreamboat device; and Arena Pharmaceuticals, Inc. to develop Ralinepag. The company was incorporated in 1996 and is headquartered in Silver Spring, Maryland.
About Akero Therapeutics
Akero Therapeutics, Inc., together with its subsidiary, engages in the development of treatments for patients with serious metabolic diseases in the United States. The company's lead product candidate is efruxifermin (EFX), which is in Phase 3 clinical trials that protects against cellular stress and regulates the metabolism of lipids, carbohydrates, and proteins throughout the body for the treatment of biopsy-confirmed metabolic dysfunction-associated steatohepatitis (MASH) patients. It has a license agreement with Amgen Inc. to develop, manufacture, use, distribute, and sell EFX as a treatment for MASH and other metabolic diseases. The company was formerly known as Pippin Pharmaceuticals, Inc. and changed its name to Akero Therapeutics, Inc. in May 2018. Akero Therapeutics, Inc. was incorporated in 2017 and is headquartered in South San Francisco, California.
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