Reviewing Opthea (NASDAQ:OPT) and Anavex Life Sciences (NASDAQ:AVXL)

Anavex Life Sciences (NASDAQ:AVXL) and Opthea (NASDAQ:OPT) are both small-cap medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, dividends, risk and institutional ownership.

Profitability

This table compares Anavex Life Sciences and Opthea’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Anavex Life Sciences	N/A	-30.32%	-27.87%
Opthea	N/A	N/A	N/A

Insider and Institutional Ownership

31.6% of Anavex Life Sciences shares are held by institutional investors. Comparatively, 56.0% of Opthea shares are held by institutional investors. 11.6% of Anavex Life Sciences shares are held by company insiders. Comparatively, 3.2% of Opthea shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

Anavex Life Sciences has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500. Comparatively, Opthea has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500.

Earnings and Valuation

This table compares Anavex Life Sciences and Opthea’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Anavex Life Sciences	N/A	N/A	-$47.51 million	($0.54)	-7.57
Opthea	$117,097.00	1,755.39	-$142.52 million	N/A	N/A

Anavex Life Sciences has higher earnings, but lower revenue than Opthea.

Analyst Recommendations

This is a summary of current ratings for Anavex Life Sciences and Opthea, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Anavex Life Sciences	0	0	1	0	3.00
Opthea	0	0	2	0	3.00

Anavex Life Sciences presently has a consensus target price of $40.00, suggesting a potential upside of 875.61%. Opthea has a consensus target price of $14.00, suggesting a potential upside of 297.73%. Given Anavex Life Sciences’ higher probable upside, equities research analysts clearly believe Anavex Life Sciences is more favorable than Opthea.

Summary

Opthea beats Anavex Life Sciences on 6 of the 9 factors compared between the two stocks.

About Anavex Life Sciences

Anavex Life Sciences Corp., a clinical stage biopharmaceutical company, engages in the development of therapeutics for the treatment of central nervous system diseases. Its lead product candidate is ANAVEX 2-73 for the treatment of Alzheimer's disease and Parkinson's disease, as well as other central nervous system diseases, including rare diseases, such as Rett syndrome, a rare severe neurological monogenic disorder; and infantile spasms, Fragile X syndrome, and Angelman syndrome. The company's drug candidate also comprises ANAVEX 3-71, which is in clinical trial for the treatment of schizophrenia, frontotemporal dementia, and Alzheimer's disease. Its preclinical drug candidates include ANAVEX 1-41 for the treatment of depression, stroke, and neurogenerative disease; ANAVEX 1066 for the potential treatment of neuropathic and visceral pain; and ANAVEX 1037 to treat prostate and pancreatic cancer. The company was incorporated in 2004 and is headquartered in New York, New York.

About Opthea

Opthea Limited, a clinical stage biopharmaceutical company, engages in the development and commercialization of therapies primarily for eye disease in Australia. The company's development activities are based on the intellectual property portfolio covering Vascular Endothelial Growth Factors (VEGF) VEGF-C, VEGF-D, and VEGF Receptor-3 for the treatment of diseases associated with blood and lymphatic vessel growth, as well as vascular leakage. Its lead product candidate is Sozinibercept (OPT 302), a soluble form of vascular endothelial growth factor receptor-3 VEGFR-3, currently under Phase 3 clinical development as a novel therapy for wet age-related macular degeneration and diabetic macular edema. The company was formerly known as Circadian Technologies Limited and changed its name to Opthea Limited in December 2015. Opthea Limited was incorporated in 1984 and is based in South Yarra, Australia.