Analyzing Editas Medicine (NASDAQ:EDIT) and Arcellx (NASDAQ:ACLX)

Editas Medicine (NASDAQ:EDIT) and Arcellx (NASDAQ:ACLX) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, analyst recommendations and risk.

Volatility & Risk

Editas Medicine has a beta of 1.87, indicating that its stock price is 87% more volatile than the S&P 500. Comparatively, Arcellx has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.

Valuation and Earnings

This table compares Editas Medicine and Arcellx”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Editas Medicine	$78.12 million	2.22	-$153.22 million	($2.56)	-0.82
Arcellx	$155.82 million	28.55	-$70.69 million	($0.71)	-115.87

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

Analyst Ratings

This is a summary of current recommendations and price targets for Editas Medicine and Arcellx, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Editas Medicine	1	6	6	0	2.38
Arcellx	0	0	13	2	3.13

Editas Medicine currently has a consensus target price of $7.92, suggesting a potential upside of 276.98%. Arcellx has a consensus target price of $105.93, suggesting a potential upside of 28.76%. Given Editas Medicine’s higher probable upside, equities analysts plainly believe Editas Medicine is more favorable than Arcellx.

Insider & Institutional Ownership

71.9% of Editas Medicine shares are owned by institutional investors. Comparatively, 96.0% of Arcellx shares are owned by institutional investors. 1.9% of Editas Medicine shares are owned by company insiders. Comparatively, 6.2% of Arcellx shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Editas Medicine and Arcellx’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Editas Medicine	-340.96%	-80.13%	-50.99%
Arcellx	-25.94%	-8.28%	-5.21%

Summary

Arcellx beats Editas Medicine on 12 of the 15 factors compared between the two stocks.

About Editas Medicine

Editas Medicine, Inc., a clinical stage genome editing company, focuses on developing transformative genomic medicines to treat a range of serious diseases. It develops a proprietary gene editing platform based on CRISPR technology. The company develops EDIT-101, which is in Phase 1/2 BRILLIANCE trial for Leber Congenital Amaurosis; and reni-cel, a clinical development gene-edited medicine to treat sickle cell disease and transfusion-dependent beta-thalassemia. In addition, the company is developing alpha-beta T cells for solid and liquid tumors; and gamma delta T cell therapies to treat cancer. It has a research collaboration with Juno Therapeutics, Inc. to develop engineered T cells for cancer; strategic alliance and option agreement with Allergan Pharmaceuticals International Limited. The company was formerly known as Gengine, Inc. and changed its name to Editas Medicine, Inc. in November 2013. Editas Medicine, Inc. was incorporated in 2013 and is based in Cambridge, Massachusetts.

About Arcellx

Arcellx, Inc., together with its subsidiary, engages in the development of various immunotherapies for patients with cancer and other incurable diseases in the United States. The company’s lead ddCAR product candidate is anitocabtagene autoleucel, which is in phase 2 clinical trial for the treatment of patients with relapsed or refractory multiple myeloma (rrMM). It also develops ACLX-001, a product candidate in Phase 1 clinical trials targeting BCMA to treat rrMM; and ACLX-002, which is in Phase 1 clinical trials that targets CD123 for treating relapsed or refractory acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). In addition, the company’s preclinical product includes ACLX-003 for the treatment of AML and MDS. Further, it focuses on the development of product candidates for solid tumor programs. It has a strategic alliance with Kite Pharma, Inc. to co-develop and co-commercialize anitocabtagene autoleucel. The company was formerly known as Encarta Therapeutics, Inc. and changed its name to Arcellx, Inc. in January 2016. Arcellx, Inc. was incorporated in 2014 and is headquartered in Redwood City, California.