Analyzing Phathom Pharmaceuticals (NASDAQ:PHAT) & Zentalis Pharmaceuticals (NASDAQ:ZNTL)

Phathom Pharmaceuticals (NASDAQ:PHAT) and Zentalis Pharmaceuticals (NASDAQ:ZNTL) are both small-cap healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.

Earnings & Valuation

This table compares Phathom Pharmaceuticals and Zentalis Pharmaceuticals”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Phathom Pharmaceuticals	$175.11 million	4.28	-$221.25 million	($1.28)	-7.23
Zentalis Pharmaceuticals	$67.43 million	4.01	-$137.06 million	($1.95)	-1.93

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

Profitability

This table compares Phathom Pharmaceuticals and Zentalis Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Phathom Pharmaceuticals	-41.34%	N/A	-20.81%
Zentalis Pharmaceuticals	N/A	-70.18%	-51.46%

Institutional & Insider Ownership

99.0% of Phathom Pharmaceuticals shares are held by institutional investors. 9.3% of Phathom Pharmaceuticals shares are held by company insiders. Comparatively, 3.8% of Zentalis Pharmaceuticals shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Phathom Pharmaceuticals has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500. Comparatively, Zentalis Pharmaceuticals has a beta of 1.85, meaning that its stock price is 85% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Phathom Pharmaceuticals and Zentalis Pharmaceuticals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Phathom Pharmaceuticals	1	0	6	1	2.88
Zentalis Pharmaceuticals	1	4	4	0	2.33

Phathom Pharmaceuticals presently has a consensus price target of $22.86, suggesting a potential upside of 146.84%. Zentalis Pharmaceuticals has a consensus price target of $6.75, suggesting a potential upside of 79.05%. Given Phathom Pharmaceuticals’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Phathom Pharmaceuticals is more favorable than Zentalis Pharmaceuticals.

Summary

Phathom Pharmaceuticals beats Zentalis Pharmaceuticals on 11 of the 15 factors compared between the two stocks.

About Phathom Pharmaceuticals

Phathom Pharmaceuticals, Inc., biopharmaceutical company, focuses on developing and commercializing treatments for gastrointestinal diseases. The company has the rights in the United States, Europe, and Canada for an investigational potassium-competitive acid blocker (P-CAB) that blocks acid secretion in the stomach. It is also developing vonoprazan for the treatment of erosive gastroesophageal reflux disease; and in combination with antibiotics for the treatment of Helicobacter pylori infection. The company was incorporated in 2018 and is headquartered in Florham Park, New Jersey.

About Zentalis Pharmaceuticals

Zentalis Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on discovering and developing small molecule therapeutics for the treatment of various cancers. Its products candidatures include the ZN-c3, an inhibitor of WEE1, a protein tyrosine kinase for the treatment of inhibitor for advanced solid tumors and hematological malignancies; in Phase 2 clinical trial as a monotherapy for the treatment of uterine serous carcinoma indications; Phase 2 clinical trial in Cyclin E1 driven high-grade serous ovarian cancer, fallopian tube, or primary peritoneal cancer; Phase 1/2 clinical trial in combination with PARPi for platinum-resistant ovarian cancer; Phase 1b clinical trial in combination with chemotherapy in platinum-resistant ovarian, and peritoneal or fallopian tube cancer; Phase 1/2 clinical trial in combination with chemotherapy in relapsed or refractory osteosarcoma; Phase 1/2 clinical trial with encorafenib and cetuximab for mutant metastatic colorectal cancer; and Phase 1/2 clinical trial in combination with chemotherapy in pancreatic cancer. The company's products pipeline also includes ZN-d5, an oral small molecule inhibitor of B-cell lymphoma 2, for hematological malignancies and related disorders; and BCL-xL heterobifunctional degrader, a member of the anti-apoptotic BCL-2 proteins, for solid tumors and hematological malignancies. Zentalis Pharmaceuticals, Inc. has licensing agreements and strategic collaborations with Recurium IP Holdings, LLC; Pfizer, Inc.; Zentera Therapeutics; Dana-Farber; and GlaxoSmithKline plc. The company was incorporated in 2014 and is headquartered in New York, New York.