Prothena (PRTA) & Rosetta Genomics (NASDAQ:ROSG) Critical Review

Prothena (NASDAQ: PRTA) and Rosetta Genomics (NASDAQ:ROSG) are both small-cap medical companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Risk and Volatility

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Prothena has a beta of 2.7, meaning that its stock price is 170% more volatile than the S&P 500. Comparatively, Rosetta Genomics has a beta of 0.47, meaning that its stock price is 53% less volatile than the S&P 500.

Profitability

This table compares Prothena and Rosetta Genomics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Prothena -556.84% -33.37% -27.92%
Rosetta Genomics N/A N/A N/A

Insider & Institutional Ownership

8.5% of Rosetta Genomics shares are held by institutional investors. 3.7% of Prothena shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Prothena and Rosetta Genomics’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Prothena $27.52 million 53.20 -$153.23 million ($4.07) -9.33
Rosetta Genomics $9.23 million 0.24 -$16.23 million ($9.31) -0.04

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

Analyst Ratings

This is a breakdown of recent ratings for Prothena and Rosetta Genomics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Prothena 0 1 10 0 2.91
Rosetta Genomics 0 1 0 0 2.00

Prothena presently has a consensus price target of $73.90, suggesting a potential upside of 94.63%. Given Prothena’s stronger consensus rating and higher possible upside, research analysts clearly believe Prothena is more favorable than Rosetta Genomics.

Summary

Prothena beats Rosetta Genomics on 8 of the 14 factors compared between the two stocks.

About Prothena

Prothena Corporation plc, a late-stage clinical biotechnology company, focuses on the discovery, development, and commercialization of novel immunotherapies for the treatment of diseases in the neuroscience and orphan categories. The company is developing antibody-based product candidates that include NEOD001, a monoclonal antibody that is in Phase III and Phase IIb clinical trials for the treatment of AL amyloidosis; PRX002/RG7935 that is in Phase II clinical trial for treating Parkinson's disease and other related synucleinopathies; and PRX004, a monoclonal antibody that is under preclinical development for the treatment of ATTR Amyloidosis. Its discovery-stage programs include Tau for treating Alzheimer's disease, progressive supranuclear palsy, frontotemporal dementia, chronic traumatic encephalopathy, and other tauopathies; Aß, or Amyloid Beta for the treatment of Alzheimer's disease; ALECT2 for ALECT2 amyloidosis; TDP-43 for amyotrophic lateral sclerosis and frontotemporal dementia; and Sortilin for frontotemporal dementia and neuro inflammation. The company has a license, development, and commercialization agreement with F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. to develop and commercialize antibodies that target alpha-synuclein; and a collaboration agreement with Celgene Corporation to develop new therapies for a range of neurodegenerative diseases. Prothena Corporation plc was incorporated in 2012 and is headquartered in Dún Laoghaire, Ireland.

About Rosetta Genomics

Rosetta Genomics Ltd. operates as a genomic diagnostics company worldwide. The company's microRNA technologies based diagnostic tests include RosettaGX Cancer Origin for the identification of the primary site of metastatic cancer; mi-KIDNEY, a kidney tumor classification test for pathology samples; RosettaGX Reveal for the diagnosis of indeterminate thyroid fine-needle aspirate samples; and mi-LUNG diagnostic tests. It also provides UroVysion, a urine-based Fluorescence In Situ Hybridization (FISH) assay that is intended for use in conjunction with and not in lieu of current standard diagnostic procedures, as an aid for initial diagnosis of bladder carcinoma in patients with hematuria and subsequent monitoring for tumor recurrence in patients previously diagnosed with bladder cancer; and ERG/PTEN, which are FISH-based prognostic tests in prostate cancer. In addition, the company offers ALK/ROS1 that are FISH-based predictive tests indicated for patients who are diagnosed with late stage lung cancer; and PCR gene mutation analysis for bladder, lung, colon, and melanoma patients. The company provides its diagnostic solutions for oncologists, urologists, endocrinologists, cytopathologists, and other specialists to facilitate them in serving their patients. It has a license agreement with Max Planck Innovation GmbH for the rights to its proprietary microRNAs for diagnostics and research purposes. The company also has a collaboration agreement with Meir Medical Center to develop a microRNA classifier relating to patients with non-small cell lung cancer considered for treatment with immuno oncology drugs. Rosetta Genomics Ltd. was founded in 2000 and is headquartered in Rehovot, Israel.

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