Comparing Merrimack Pharmaceuticals (MACK) & Idera Pharmaceuticals (IDRA)

Idera Pharmaceuticals (NASDAQ: IDRA) and Merrimack Pharmaceuticals (NASDAQ:MACK) are both small-cap medical companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, valuation, risk, analyst recommendations and earnings.

Profitability

This table compares Idera Pharmaceuticals and Merrimack Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Idera Pharmaceuticals -300.63% -61.09% -55.14%
Merrimack Pharmaceuticals -105.18% N/A -99.74%

Earnings & Valuation

This table compares Idera Pharmaceuticals and Merrimack Pharmaceuticals’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Idera Pharmaceuticals $16.17 million 16.42 -$42.73 million ($0.33) -5.39
Merrimack Pharmaceuticals $144.27 million 1.16 -$87.05 million $3.15 0.40

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

Insider & Institutional Ownership

31.3% of Idera Pharmaceuticals shares are held by institutional investors. Comparatively, 59.2% of Merrimack Pharmaceuticals shares are held by institutional investors. 30.3% of Idera Pharmaceuticals shares are held by insiders. Comparatively, 8.5% of Merrimack Pharmaceuticals 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.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Idera Pharmaceuticals and Merrimack Pharmaceuticals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Idera Pharmaceuticals 0 0 4 0 3.00
Merrimack Pharmaceuticals 0 4 0 0 2.00

Idera Pharmaceuticals presently has a consensus target price of $5.28, indicating a potential upside of 196.35%. Merrimack Pharmaceuticals has a consensus target price of $6.00, indicating a potential upside of 376.19%. Given Merrimack Pharmaceuticals’ higher possible upside, analysts clearly believe Merrimack Pharmaceuticals is more favorable than Idera Pharmaceuticals.

Volatility and Risk

Idera Pharmaceuticals has a beta of 2.19, suggesting that its share price is 119% more volatile than the S&P 500. Comparatively, Merrimack Pharmaceuticals has a beta of 2.02, suggesting that its share price is 102% more volatile than the S&P 500.

Summary

Idera Pharmaceuticals beats Merrimack Pharmaceuticals on 7 of the 13 factors compared between the two stocks.

About Idera Pharmaceuticals

Idera Pharmaceuticals, Inc. is a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of therapeutics for oncology and rare diseases. The Company utilizes two drug discovery technology platforms to design and develop drug candidates, which include Toll-like receptor (TLR) targeting technology and third-generation antisense (3GA) technology. Using TLR technology, the Company designs synthetic oligonucleotide-based drug candidates to act by modulating the activity of specific TLRs. Using its 3GA technology, the Company is developing drug candidates to turn off the messenger ribo nucleic acid (mRNA) associated with disease causing genes. The Company’s drug candidates include IMO-8400, IMO-2125 and IMO-9200. The Company has designed TLR antagonists and agonists to act by modulating the activity of targeted TLRs. It is developing its 3GA technology to turn off the mRNA associated with disease causing genes.

About Merrimack Pharmaceuticals

Merrimack Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is engaged in discovering, developing and commercializing medicines consisting of therapeutics paired with companion diagnostics for the treatment of cancer. The Company has one marketed therapeutic oncology product and multiple targeted therapeutic oncology candidates in clinical development. Its advanced program is its therapeutic MM-398, which it markets in the United States under the brand name ONIVYDE. Its other clinical stage product candidates include MM-121, MM-141, MM-310, MM-302 and MM-151. The Company is developing in vitro and in vivo diagnostics for use with each of its oncology therapeutic product candidates. Its in vitro diagnostic agents employ biophysical or biochemical markers of cancer, or biomarkers. Its in vivo diagnostics take the form of imaging agents that may help identify patients likely to benefit from its therapeutic products by measuring deposition of its products in the tumor.

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