Arcutis Biotherapeutics (NASDAQ:ARQT – Get Free Report) and ProPhase Labs (NASDAQ:PRPH – Get Free Report) are both small-cap medical companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, dividends, analyst recommendations, profitability and earnings.
Institutional & Insider Ownership
9.5% of ProPhase Labs shares are held by institutional investors. 9.5% of Arcutis Biotherapeutics shares are held by company insiders. Comparatively, 20.7% of ProPhase Labs 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.
Risk and Volatility
Arcutis Biotherapeutics has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, ProPhase Labs has a beta of -0.1, suggesting that its share price is 110% less volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Arcutis Biotherapeutics | 0 | 1 | 3 | 0 | 2.75 |
| ProPhase Labs | 0 | 0 | 1 | 0 | 3.00 |
Arcutis Biotherapeutics currently has a consensus price target of $15.50, suggesting a potential upside of 64.37%. ProPhase Labs has a consensus price target of $11.00, suggesting a potential upside of 1,297.00%. Given ProPhase Labs’ stronger consensus rating and higher probable upside, analysts clearly believe ProPhase Labs is more favorable than Arcutis Biotherapeutics.
Valuation and Earnings
This table compares Arcutis Biotherapeutics and ProPhase Labs”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Arcutis Biotherapeutics | $59.61 million | 18.52 | -$262.14 million | ($1.79) | -5.27 |
| ProPhase Labs | $44.38 million | 0.42 | -$16.78 million | ($1.26) | -0.62 |
ProPhase Labs has lower revenue, but higher earnings than Arcutis Biotherapeutics. Arcutis Biotherapeutics is trading at a lower price-to-earnings ratio than ProPhase Labs, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Arcutis Biotherapeutics and ProPhase Labs’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Arcutis Biotherapeutics | -140.97% | -119.11% | -45.95% |
| ProPhase Labs | -217.64% | -62.92% | -30.22% |
Summary
ProPhase Labs beats Arcutis Biotherapeutics on 9 of the 14 factors compared between the two stocks.
About Arcutis Biotherapeutics
Arcutis Biotherapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing treatments for dermatological diseases. Its lead product candidate is ARQ-151, a topical roflumilast cream that has completed Phase III clinical trials for the treatment of plaque psoriasis and atopic dermatitis. The company is also developing ARQ-154, a topical ZORYVE for the treatment of scalp and body psoriasis and seborrheic dermatitis; ARQ-252, a selective topical janus kinase type 1 inhibitor for hand eczema and vitiligo; ARQ-255, a topical JAK1 inhibitor for alopecia areata; and ARQ-234, a CD200R fusion protein for the treatment of moderate-to-severe atopic dermatitis. The company was formerly known as Arcutis, Inc. and changed its name to Arcutis Biotherapeutics, Inc. in October 2019. Arcutis Biotherapeutics, Inc. was incorporated in 2016 and is headquartered in Westlake Village, California.
About ProPhase Labs
ProPhase Labs, Inc. develops and commercializes novel drugs, dietary supplements, and compounds in the United States. It operates through two segments: Diagnostic Services and Consumer Products. The company provides a range of TK supplements, including Legendz XL for male sexual health; and Triple Edge XL, an energy and stamina booster. It offers contract manufacturing services, such as product development, pre-commercialization, production, warehousing, and distribution; COVID-19 diagnostic information services to a range of customers, including health plans, third party payers, and government organizations; and respiratory pathogen panel molecular testing services, as well as personal genomics products and services. In addition, the company involved in the research, development, manufacture, distribution, marketing, and sale of over the counter (OTC) consumer healthcare products and dietary supplements; and retail operations. The company was formerly known as The Quigley Corporation. ProPhase Labs, Inc. was founded in 1989 and is headquartered in Garden City, New York.
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