COMPASS Pathways (NASDAQ:CMPS – Get Free Report) and Legend Biotech (NASDAQ:LEGN – Get Free Report) are both medical companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.
Profitability
This table compares COMPASS Pathways and Legend Biotech’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| COMPASS Pathways | N/A | -63.85% | -51.97% |
| Legend Biotech | -66.92% | -29.69% | -19.45% |
Valuation & Earnings
This table compares COMPASS Pathways and Legend Biotech”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| COMPASS Pathways | N/A | N/A | -$118.46 million | ($2.20) | -2.27 |
| Legend Biotech | $285.14 million | 24.19 | -$518.25 million | ($0.95) | -39.76 |
Risk and Volatility
COMPASS Pathways has a beta of 2.28, suggesting that its stock price is 128% more volatile than the S&P 500. Comparatively, Legend Biotech has a beta of 0.17, suggesting that its stock price is 83% less volatile than the S&P 500.
Institutional & Insider Ownership
46.2% of COMPASS Pathways shares are owned by institutional investors. Comparatively, 70.9% of Legend Biotech shares are owned by institutional investors. 4.3% of COMPASS Pathways shares are owned by insiders. Comparatively, 0.0% of Legend Biotech shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Analyst Recommendations
This is a breakdown of recent ratings and price targets for COMPASS Pathways and Legend Biotech, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| COMPASS Pathways | 0 | 0 | 6 | 0 | 3.00 |
| Legend Biotech | 0 | 0 | 12 | 0 | 3.00 |
COMPASS Pathways currently has a consensus target price of $33.60, indicating a potential upside of 573.35%. Legend Biotech has a consensus target price of $79.50, indicating a potential upside of 110.48%. Given COMPASS Pathways’ higher possible upside, equities analysts plainly believe COMPASS Pathways is more favorable than Legend Biotech.
About COMPASS Pathways
COMPASS Pathways plc operates as a mental health care company in the United Kingdom and the United States. It develops COMP360, a psilocybin therapy that is in Phase III clinical trials for the treatment of treatment-resistant depression; and is in Phase II clinical trials for the treatment of post-traumatic stress disorder and anorexia nervosa. The company was formerly known as COMPASS Rx Limited and changed its name to COMPASS Pathways plc in August 2020. COMPASS Pathways plc was incorporated in 2020 and is headquartered in London, the United Kingdom.
About Legend Biotech
Legend Biotech Corporation, a clinical-stage biopharmaceutical company, through its subsidiaries, engages in the discovery, development, manufacturing, and commercialization of novel cell therapies for oncology and other indications in the United States, China, and internationally. Its lead product candidate, LCAR- B38M, is a chimeric antigen receptor for the treatment of multiple myeloma (MM). The company also has a portfolio of earlier-stage autologous CAR-T product candidates targeting various cancers, including Non-Hodgkins Lymphoma, acute lymphoblastic leukemia, gastric cancer, esophageal cancer, pancreatic cancer, colorectal cancer, hepatocellular carcinoma, small cell lung cancer, and non-small cell lung cancer. It has collaboration and license agreement with Janssen Biotech, Inc. for the development and commercialization of ciltacabtagene autoleucel. The company was founded in 2014 and is based in Somerset, New Jersey. Legend Biotech Corporation is a subsidiary of Genscript Biotech Corporation.
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