ObsEva (NASDAQ:OBSV) versus Galecto (NASDAQ:GLTO) Head-To-Head Contrast

ObsEva (NASDAQ:OBSV) and Galecto (NASDAQ:GLTO) are both small-cap medical companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Risk and Volatility

ObsEva has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500. Comparatively, Galecto has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for ObsEva and Galecto, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ObsEva	0	0	0	0	0.00
Galecto	0	0	1	0	3.00

Galecto has a consensus target price of $10.00, suggesting a potential upside of 77.94%. Given Galecto’s stronger consensus rating and higher probable upside, analysts clearly believe Galecto is more favorable than ObsEva.

Institutional & Insider Ownership

17.5% of ObsEva shares are owned by institutional investors. Comparatively, 14.2% of Galecto shares are owned by institutional investors. 14.4% of ObsEva shares are owned by company insiders. Comparatively, 11.9% of Galecto shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares ObsEva and Galecto”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ObsEva	$20.11 million	0.00	-$58.38 million	($0.92)	N/A
Galecto	N/A	N/A	-$38.35 million	($19.14)	-0.29

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

Profitability

This table compares ObsEva and Galecto’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ObsEva	N/A	-416.36%	-92.01%
Galecto	N/A	-76.96%	-66.59%

Summary

Galecto beats ObsEva on 7 of the 12 factors compared between the two stocks.

About ObsEva

ObsEva SA is a clinical-stage biopharmaceutical company, which engages in the research and development of therapeutic treatments for women’s reproductive health and pregnancy. It offers biopharmaceutical drugs addressing conditions compromising pregnancy from conception to birth. The company was founded by Ernest Loumaye and André Chollet on November 14, 2012 and is headquartered in Geneva, Switzerland.

About Galecto

Galecto, Inc., a clinical-stage biotechnology company, develops molecules for the treatment of fibrosis, cancer, inflammation, and other related diseases. The company's lead product candidate is GB2064, which is in Phase IIa for the treatment of myelofibrosis. It also develops GB2064, a selective oral small molecule inhibitor of LOXL2 that is in Phase 2a clinical trial for the treatment of fibrotic diseases, including cancer and myelofibrosis; and GB1211, a selective oral galectin-3 inhibitor that is in Phase IIa for the treatment of cancer, as well as in Phase Ib/IIa for fibrosis. Galecto, Inc. was founded in 2011 and is headquartered in Copenhagen, Denmark.