Critical Survey: Cumberland Pharmaceuticals (NASDAQ:CPIX) versus Spero Therapeutics (NASDAQ:SPRO)

Cumberland Pharmaceuticals (NASDAQ:CPIX) and Spero Therapeutics (NASDAQ:SPRO) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.

Risk & Volatility

Cumberland Pharmaceuticals has a beta of -0.19, indicating that its share price is 119% less volatile than the S&P 500. Comparatively, Spero Therapeutics has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Insider & Institutional Ownership

15.5% of Cumberland Pharmaceuticals shares are owned by institutional investors. Comparatively, 25.6% of Spero Therapeutics shares are owned by institutional investors. 43.3% of Cumberland Pharmaceuticals shares are owned by company insiders. Comparatively, 4.5% of Spero Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Cumberland Pharmaceuticals and Spero Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cumberland Pharmaceuticals	-29.54%	-9.50%	-3.19%
Spero Therapeutics	3.30%	4.03%	2.21%

Analyst Recommendations

This is a summary of current recommendations and price targets for Cumberland Pharmaceuticals and Spero Therapeutics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cumberland Pharmaceuticals	0	0	0	0	0.00
Spero Therapeutics	0	2	2	0	2.50

Spero Therapeutics has a consensus target price of $5.00, indicating a potential upside of 539.06%. Given Spero Therapeutics’ stronger consensus rating and higher probable upside, analysts plainly believe Spero Therapeutics is more favorable than Cumberland Pharmaceuticals.

Earnings & Valuation

This table compares Cumberland Pharmaceuticals and Spero Therapeutics”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cumberland Pharmaceuticals	$37.87 million	2.02	-$6.28 million	($0.47)	-11.62
Spero Therapeutics	$89.87 million	0.47	$22.81 million	$0.07	11.18

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

Summary

Spero Therapeutics beats Cumberland Pharmaceuticals on 12 of the 14 factors compared between the two stocks.

About Cumberland Pharmaceuticals

Cumberland Pharmaceuticals Inc., a specialty pharmaceutical company, focuses on the acquisition, development, and commercialization of prescription products for hospital acute care, gastroenterology, and oncology in the United States and internationally. The company offers Acetadote, an injection for the treatment of acetaminophen poisoning; Caldolor, an injection for the treatment of pain and fever; Kristalose, a prescription laxative oral solution for the treatment of constipation; Omeclamox-Pak for the treatment of Helicobacter pylori infection and duodenal ulcer disease; Vaprisol, an injection for treating euvolemic and hypervolemic hyponatremia; Sancuso, an injection for the treatment of chemotherapy treatment; and Vibativ, an injection for the treatment of certain serious bacterial infections, including hospital-acquired and ventilator-associated bacterial pneumonia, as well as complicated skin and skin structure infections. It develops RediTrex injection for the treatment of active rheumatoid, juvenile idiopathic, and severe psoriatic arthritis, as well as disabling psoriasis. In addition, the company is developing ifetroban, a product candidate that is in phase II clinical trial for the treatment of aspirin-exacerbated respiratory disease, systemic sclerosis, and duchenne muscular dystrophy; and has completed phase II clinical trial for the treatment of hepatorenal syndrome and portal hypertension. Further, it develops a clinical program for the use of ifetroban to treat progressive fibrosing interstitial lung diseases. The company was incorporated in 1999 and is headquartered in Nashville, Tennessee.

About Spero Therapeutics

Spero Therapeutics, Inc., a clinical-stage biopharmaceutical company, focuses on identifying, developing, and commercializing novel treatments for multi-drug resistant (MDR) bacterial infections and rare diseases in the United States. The company’s product candidates include tebipenem pivoxil hydrobromide (HBr), an oral carbapenem-class antibiotic to treat complicated urinary tract infections, including pyelonephritis for adults; SPR206, an intravenous-administered antibiotic against MDR Gram-negative pathogens comprising carbapenem-resistant enterobacterales (CRE), acinetobacter baumannii, and pseudomonas aeruginosa, as well as negative bacterial infections in the hospital setting; and SPR720, a novel oral antibiotic agent for the treatment of non-tuberculous mycobacterial pulmonary disease. It has license agreement with Meiji Seika Pharma Co., Ltd. to support the development of tebipenem HBr; Everest Medicines to develop, manufacture, and commercialize SPR206 in Greater China, South Korea, and Southeast Asian countries; and Vertex Pharmaceuticals Incorporated for patents relating to SPR720, as well as SPR719, an active metabolite. Spero Therapeutics, Inc. was founded in 2013 and is headquartered in Cambridge, Massachusetts.