Critical Contrast: Apellis Pharmaceuticals (NASDAQ:APLS) & Design Therapeutics (NASDAQ:DSGN)

Apellis Pharmaceuticals (NASDAQ:APLS) and Design Therapeutics (NASDAQ:DSGN) are both medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Apellis Pharmaceuticals and Design Therapeutics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Apellis Pharmaceuticals	0	4	10	1	2.80
Design Therapeutics	0	2	1	0	2.33

Apellis Pharmaceuticals presently has a consensus price target of $71.67, suggesting a potential upside of 97.37%. Design Therapeutics has a consensus price target of $7.00, suggesting a potential upside of 26.13%. Given Apellis Pharmaceuticals’ stronger consensus rating and higher probable upside, research analysts clearly believe Apellis Pharmaceuticals is more favorable than Design Therapeutics.

Risk & Volatility

Apellis Pharmaceuticals has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500. Comparatively, Design Therapeutics has a beta of 1.82, suggesting that its stock price is 82% more volatile than the S&P 500.

Profitability

This table compares Apellis Pharmaceuticals and Design Therapeutics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Apellis Pharmaceuticals	-52.99%	-138.32%	-39.63%
Design Therapeutics	N/A	-18.48%	-17.76%

Valuation & Earnings

This table compares Apellis Pharmaceuticals and Design Therapeutics”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Apellis Pharmaceuticals	$396.59 million	11.15	-$528.63 million	($3.46)	-10.49
Design Therapeutics	N/A	N/A	-$66.86 million	($1.05)	-5.29

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

Insider & Institutional Ownership

96.3% of Apellis Pharmaceuticals shares are owned by institutional investors. Comparatively, 56.6% of Design Therapeutics shares are owned by institutional investors. 6.8% of Apellis Pharmaceuticals shares are owned by company insiders. Comparatively, 31.2% of Design Therapeutics shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Design Therapeutics beats Apellis Pharmaceuticals on 8 of the 14 factors compared between the two stocks.

About Apellis Pharmaceuticals

Apellis Pharmaceuticals, Inc., a commercial-stage biopharmaceutical company, focuses on the discovery, development, and commercialization of therapeutic compounds through the inhibition of the complement system for autoimmune and inflammatory diseases. It offers EMPAVELI for the treatment of paroxysmal nocturnal hemoglobinuria, C3 glomerulopathy and immune complex membranoproliferative glomerulonephritis, and hematopoietic stem cell transplantation-associated thrombotic microangiopathy; and SYFOVRE for treating geographic atrophy secondary to age-related macular degeneration and geographic atrophy (GA). The company also develops APL-3007, a small interfering RNA, or siRNA, which is in a Phase 1 clinical trial, as well as an oral complement inhibitor that is in preclinical development. It has a collaboration and license agreement with Swedish Orphan Biovitrum AB (publ) for development and commercialization of pegcetacoplan; and a collaboration with Beam Therapeutics Inc. focused on the use of Beam's base editing technology to discover new treatments for complement-driven diseases. The company was incorporated in 2009 and is based in Waltham, Massachusetts.

About Design Therapeutics

Design Therapeutics, Inc. a biopharmaceutical company, researches, designs, develops, and commercializes small molecule therapeutic drugs for the treatment of genetic diseases in the United States. The company utilizes its GeneTAC platform to design and develop therapeutic candidates for inherited diseases caused by nucleotide repeat expansion. Its lead product candidates for potentially disease-modifying treatment comprises Friedreich Ataxia, a monogenic, autosomal recessive, progressive multi-system disease that affects organ systems dependent on mitochondrial function that brings to neurological, cardiac, and metabolic dysfunction; Myotonic Dystrophy Type-1, a dominantly-inherited, monogenic progressive neuromuscular disease affecting skeletal muscle, heart, brain, and other organs; Fuchs Endothelial Corneal Dystrophy, a genetic eye disease characterized by bilateral degeneration of corneal endothelial cells and progressive loss of vision; and Huntington's Disease, a dominantly inherited, monogenic neurodegenerative disease characterized by movement, cognitive, and psychiatric disorders. Design Therapeutics, Inc. was incorporated in 2017 and is headquartered in Carlsbad, California.