Financial Survey: Nektar Therapeutics (NASDAQ:NKTR) vs. Aravive (NASDAQ:ARAV)

Aravive (NASDAQ:ARAV) and Nektar Therapeutics (NASDAQ:NKTR) are both small-cap medical companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, institutional ownership, analyst recommendations, risk and profitability.

Profitability

This table compares Aravive and Nektar Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aravive	N/A	N/A	N/A
Nektar Therapeutics	-180.70%	-173.28%	-46.31%

Analyst Recommendations

This is a summary of current ratings and target prices for Aravive and Nektar Therapeutics, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aravive	0	0	0	0	0.00
Nektar Therapeutics	0	2	4	0	2.67

Nektar Therapeutics has a consensus target price of $4.10, suggesting a potential upside of 343.20%. Given Nektar Therapeutics’ stronger consensus rating and higher possible upside, analysts clearly believe Nektar Therapeutics is more favorable than Aravive.

Institutional & Insider Ownership

35.8% of Aravive shares are held by institutional investors. Comparatively, 75.9% of Nektar Therapeutics shares are held by institutional investors. 60.4% of Aravive shares are held by insiders. Comparatively, 3.7% of Nektar Therapeutics shares are held by 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.

Volatility and Risk

Aravive has a beta of 2.19, suggesting that its share price is 119% more volatile than the S&P 500. Comparatively, Nektar Therapeutics has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500.

Earnings and Valuation

This table compares Aravive and Nektar Therapeutics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aravive	$6.99 million	0.42	-$76.32 million	($0.96)	-0.04
Nektar Therapeutics	$93.14 million	1.83	-$276.06 million	($0.84)	-1.10

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

About Aravive

Aravive, Inc., a clinical-stage biopharmaceutical company, develops transformative treatments for life-threatening diseases, including cancer and fibrosis in the United States. Its lead product candidate is batiraxcept, an ultrahigh-affinity, decoy protein that targets the GAS6-AXL signaling pathway, which is in Phase III clinical trial for the treatment of platinum- resistant recurrent ovarian cancer; and in Phase Ib/II clinical trial for the treatment of clear cell renal cell carcinoma and pancreatic adenocarcinoma. The company also develops AVB-S6, a soluble Fc-fusion protein to block the activation of the GAS6-AXL signaling pathway. It has a license and collaboration agreement with WuXi Biologics (Hong Kong) Limited to identify and develop novel high-affinity bispecific antibodies targeting cancer and fibrosis; and license agreement with 3D Medicines Inc. to develop products that contain batiraxcept as the sole drug substance for the treatment of human oncological diseases in mainland China, Taiwan, Hong Kong, and Macau. The company was formerly known as Versartis, Inc. and changed its name to Aravive, Inc. in October 2018. Aravive, Inc. was incorporated in 2008 and is headquartered in Houston, Texas.

About Nektar Therapeutics

Nektar Therapeutics, a biopharmaceutical company, focuses on discovering and developing medicines in the field of immunotherapy in the United States and internationally. The company is developing rezpegaldesleukin, a cytokine Treg stimulant that is in phase 2 clinical trial for the treatment of systemic lupus erythematosus and ulcerative colitis, as well as phase 2b clinical trial to treat atopic dermatitis and psoriasis; and NKTR-255, an IL-15 receptor agonist, which is in phase 1 clinical trial to boost the immune system's natural ability to fight cancer. It has collaboration agreements with Takeda Pharmaceutical Company Ltd.; AstraZeneca AB; UCB Pharma S.A.; F. Hoffmann-La Roche Ltd; Bausch Health Companies Inc.; Pfizer Inc.; Amgen Inc.; UCB Pharma (Biogen); Bristol-Myers Squibb Company; Merck KGaA; and SFJ Pharmaceuticals, Inc. The company was incorporated in 1990 and is headquartered in San Francisco, California.