Financial Analysis: Evotec (NASDAQ:EVO) & Sagimet Biosciences (NASDAQ:SGMT)

Sagimet Biosciences (NASDAQ:SGMT) and Evotec (NASDAQ:EVO) are both small-cap medical companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, earnings, valuation and dividends.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Sagimet Biosciences and Evotec, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sagimet Biosciences	0	1	5	0	2.83
Evotec	1	2	2	0	2.20

Sagimet Biosciences presently has a consensus price target of $21.60, indicating a potential upside of 353.78%. Evotec has a consensus price target of $5.93, indicating a potential upside of 32.15%. Given Sagimet Biosciences’ stronger consensus rating and higher possible upside, analysts plainly believe Sagimet Biosciences is more favorable than Evotec.

Insider and Institutional Ownership

87.9% of Sagimet Biosciences shares are owned by institutional investors. Comparatively, 5.8% of Evotec shares are owned by institutional investors. 17.6% of Sagimet Biosciences shares are owned by company insiders. Comparatively, 1.0% of Evotec shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Sagimet Biosciences has a beta of 2.29, meaning that its share price is 129% more volatile than the S&P 500. Comparatively, Evotec has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Profitability

This table compares Sagimet Biosciences and Evotec’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sagimet Biosciences	N/A	-23.63%	-22.91%
Evotec	N/A	N/A	N/A

Valuation & Earnings

This table compares Sagimet Biosciences and Evotec”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sagimet Biosciences	$2.00 million	72.99	-$27.88 million	N/A	N/A
Evotec	$845.74 million	1.88	-$90.82 million	N/A	N/A

Sagimet Biosciences has higher earnings, but lower revenue than Evotec.

Summary

Sagimet Biosciences beats Evotec on 8 of the 11 factors compared between the two stocks.

About Sagimet Biosciences

Sagimet Biosciences Inc., a clinical-stage biopharmaceutical company, develops therapeutics called fatty acid synthase (FASN) inhibitors for the treatment of diseases that result from dysfunctional metabolic pathways in the United States. The company’s lead drug candidate is Denifanstat, a once-daily pill and selective FASN inhibitor for the treatment of metabolic dysfunction associated steatohepatitis. It also develops TVB-3567, a FASN inhibitor for the treatment of acne; and other oncology programs. The company was formerly known as 3-V Biosciences, Inc. and changed its name to Sagimet Biosciences Inc. in August 2019. Sagimet Biosciences Inc. was incorporated in 2006 and is headquartered in San Mateo, California.

About Evotec

Evotec SE operates as drug discovery and development partner for the pharmaceutical and biotechnology industry worldwide. The company is developing pharmaceutical products in various therapeutic areas, such as autoimmune diseases, cancer, CNS diseases, diabetes, fibrosis, immunology, infectious diseases, kidney diseases, liver diseases, pain and inflammation, rare diseases, respiratory diseases, tuberculosis, and women’s health. It has collaboration agreements with SK bioscience, JingXin, Carrick Therapeutics, Sernova, Topas Therapeutics, Exscientia, CONBA Group, Centrexion, Sanofi/NIH, Kazia Therapeutics, Bristol Myers Squibb, Topas Therapeutics, Immunitas, Exscientia, and Bayer; and Inserm, the French National Institute of Health and Medical Research, Lille University Hospital, and Inserm Transfert to identify novel therapeutic targets and diagnostic and prognostic markers in obesity and metabolic diseases, as well as collaboration with CHDI Foundation, Inc.; and a strategic partnership with Dewpoint Therapeutics to advance its portfolio targeting biomolecular condensates as a novel domain for therapeutic intervention towards the clinic, as well as research collaboration with Pfizer for metabolic and infectious diseases. The company was formerly known as Evotec AG and changed its name to Evotec SE in April 2019. Evotec SE was incorporated in 1993 and is headquartered in Hamburg, Germany.