Catalyst Pharmaceuticals (NASDAQ:CPRX) vs. Vanda Pharmaceuticals (NASDAQ:VNDA) Critical Contrast

Catalyst Pharmaceuticals (NASDAQ:CPRX) and Vanda Pharmaceuticals (NASDAQ:VNDA) are both medical companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Earnings & Valuation

This table compares Catalyst Pharmaceuticals and Vanda Pharmaceuticals”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Catalyst Pharmaceuticals	$434.48 million	5.65	$71.41 million	$0.54	38.50
Vanda Pharmaceuticals	$182.02 million	1.47	$2.51 million	($0.08)	-57.63

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

Profitability

This table compares Catalyst Pharmaceuticals and Vanda Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Catalyst Pharmaceuticals	15.69%	27.77%	23.68%
Vanda Pharmaceuticals	-6.00%	-2.01%	-1.68%

Institutional and Insider Ownership

79.2% of Catalyst Pharmaceuticals shares are owned by institutional investors. Comparatively, 88.1% of Vanda Pharmaceuticals shares are owned by institutional investors. 11.0% of Catalyst Pharmaceuticals shares are owned by company insiders. Comparatively, 7.7% of Vanda Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for Catalyst Pharmaceuticals and Vanda Pharmaceuticals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Catalyst Pharmaceuticals	0	0	6	0	3.00
Vanda Pharmaceuticals	0	0	1	0	3.00

Catalyst Pharmaceuticals currently has a consensus target price of $29.50, suggesting a potential upside of 41.90%. Vanda Pharmaceuticals has a consensus target price of $13.00, suggesting a potential upside of 182.00%. Given Vanda Pharmaceuticals’ higher probable upside, analysts plainly believe Vanda Pharmaceuticals is more favorable than Catalyst Pharmaceuticals.

Risk and Volatility

Catalyst Pharmaceuticals has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, Vanda Pharmaceuticals has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500.

Summary

Catalyst Pharmaceuticals beats Vanda Pharmaceuticals on 10 of the 13 factors compared between the two stocks.

About Catalyst Pharmaceuticals

Catalyst Pharmaceuticals, Inc., a commercial-stage biopharmaceutical company, focuses on developing and commercializing therapies for people with rare debilitating, chronic neuromuscular, and neurological diseases in the United States. It offers Firdapse, an amifampridine phosphate tablets for the treatment of patients with lambert-eaton myasthenic syndrome (LEMS); and Ruzurgi for the treatment of pediatric LEMS patients. The company develops Firdapse for the treatment of MuSK antibody positive myasthenia gravis and spinal muscular atrophy type. It has license agreements with BioMarin Pharmaceutical Inc.; and collaboration and license agreement with Endo Ventures Limited for the development and commercialization of generic Sabril tablets. The company was founded in 2002 and is based in Coral Gables, Florida.

About Vanda Pharmaceuticals

Vanda Pharmaceuticals Inc., a biopharmaceutical company, focuses on the development and commercialization of therapies to address high unmet medical needs worldwide. The company’s marketed products include HETLIOZ to treat non-24-hour sleep-wake disorders; and Fanapt oral tablets for the treatment of schizophrenia. Its pipeline products include HETLIOZ (tasimelteon) to treat jet lag disorder, insomnia, delayed sleep phase disorder, sleep disturbances in autism spectrum disorder, and pediatric Non-24; Fanapt (iloperidone) for the treatment of bipolar I disorder and Parkinson’s disease psychosis, as well as a long acting injectable (LAI) formulation to treat schizophrenia; and Tradipitant (VLY-686), a small molecule neurokinin-1 receptor (NK-1R) antagonist to treat gastroparesis, motion sickness, atopic dermatitis, and COVID-19 pneumonia. The company’s pipeline products also include VTR-297, a small molecule histone deacetylase inhibitor to treat hematologic malignancies and with potential use as a treatment for various oncology indications; VQW-765, a small molecule nicotinic acetylcholine receptor partial agonist to treat performance anxiety and psychiatric disorders; VHX-896, an active metabolite of iloperidone; and antisense oligonucleotide molecules. In addition, it offers a portfolio of cystic fibrosis transmembrane conductance regulator activators and inhibitors that include VSJ-110 for the treatment of dry eye and ocular inflammation; and VPO-227 for the treatment of secretory diarrhea disorders comprising cholera. Vanda Pharmaceuticals Inc. was incorporated in 2002 and is headquartered in Washington, the District of Columbia.