Head-To-Head Comparison: Mereo BioPharma Group (NASDAQ:MREO) & Ultragenyx Pharmaceutical (NASDAQ:RARE)

Mereo BioPharma Group (NASDAQ:MREO) and Ultragenyx Pharmaceutical (NASDAQ:RARE) are both small-cap healthcare companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.

Valuation and Earnings

This table compares Mereo BioPharma Group and Ultragenyx Pharmaceutical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mereo BioPharma Group	$500,000.00	116.57	-$41.88 million	($0.04)	-9.12
Ultragenyx Pharmaceutical	$673.00 million	2.16	-$575.00 million	($5.84)	-2.53

Mereo BioPharma Group has higher earnings, but lower revenue than Ultragenyx Pharmaceutical. Mereo BioPharma Group is trading at a lower price-to-earnings ratio than Ultragenyx Pharmaceutical, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and price targets for Mereo BioPharma Group and Ultragenyx Pharmaceutical, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mereo BioPharma Group	2	3	3	0	2.12
Ultragenyx Pharmaceutical	1	10	9	1	2.48

Mereo BioPharma Group currently has a consensus target price of $1.67, suggesting a potential upside of 356.62%. Ultragenyx Pharmaceutical has a consensus target price of $34.58, suggesting a potential upside of 134.50%. Given Mereo BioPharma Group’s higher possible upside, equities analysts clearly believe Mereo BioPharma Group is more favorable than Ultragenyx Pharmaceutical.

Institutional & Insider Ownership

62.8% of Mereo BioPharma Group shares are owned by institutional investors. Comparatively, 97.7% of Ultragenyx Pharmaceutical shares are owned by institutional investors. 6.5% of Mereo BioPharma Group shares are owned by company insiders. Comparatively, 5.2% of Ultragenyx Pharmaceutical shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Mereo BioPharma Group and Ultragenyx Pharmaceutical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mereo BioPharma Group	N/A	-74.82%	-64.28%
Ultragenyx Pharmaceutical	-81.79%	-1,024.42%	-44.40%

Volatility & Risk

Mereo BioPharma Group has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500. Comparatively, Ultragenyx Pharmaceutical has a beta of 0.31, meaning that its share price is 69% less volatile than the S&P 500.

Summary

Mereo BioPharma Group beats Ultragenyx Pharmaceutical on 8 of the 15 factors compared between the two stocks.

About Mereo BioPharma Group

Mereo BioPharma Group plc, a biopharmaceutical company, develops and commercializes therapeutics for the treatment of oncology and rare diseases in the United Kingdom, the United States, and internationally. It develops Etigilimab (MPH-313), an antibody T-cell immunoreceptor with Ig and ITIM domains, which is in Phase 1b clinical trial for the treatment of tumors. The company is also developing Navicixizumab (OMP-305B83), which has completed Phase 1b clinical trials for the treatment of the late line ovarian cancer; Acumapimod (BCT-197), a p38 MAP kinase inhibitor that is in Phase II clinical trials to treat acute exacerbations of chronic obstructive pulmonary disease; and Leflutrozole (BGS-649), an oral aromatase inhibitor for the treatment of hypogonadotropic hypogonadism which is in Phase 2 trials. In addition, it develops rare disease product candidates, including Setrusumab (BPS-804), an antibody for the treatment of osteogenesis imperfecta; and Alvelestat (MPH-966), an oral small molecule that is in Phase II clinical trial to treat Alpha-1 anti-trypsin deficiency. The company has a license agreement with Feng Biosciences for the development and commercialization of navicixizumab; license agreement with ReproNovo for the development and commercialization of leflutrozole; licensing agreement with AstraZeneca; and license agreement with Ultragenyx Pharmaceutical Inc. to develop and commercialize setrusumab. Mereo BioPharma Group plc was incorporated in 2015 and is headquartered in London, the United Kingdom.

About Ultragenyx Pharmaceutical

Ultragenyx Pharmaceutical Inc., a biopharmaceutical company, focuses on the identification, acquisition, development, and commercialization of novel products for the treatment of rare and ultra-rare genetic diseases in North America, Latin America, Japan, Europe, and internationally. Its biologic products include Crysvita (burosumab), an antibody targeting fibroblast growth factor 23 for the treatment of X-linked hypophosphatemia, as well as tumor-induced osteomalacia; Mepsevii, an enzyme replacement therapy for the treatment of children and adults with Mucopolysaccharidosis VII; Dojolvi for treating long-chain fatty acid oxidation disorders; and Evkeeza (evinacumab) for the treatment of homozygous familial hypercholesterolemia. The company's products candidatures include DTX401, an adeno-associated virus 8 (AAV8) gene therapy clinical candidate for the treatment of patients with glycogen storage disease type Ia; DTX301, an AAV8 gene therapy for the treatment of patients with ornithine transcarbamylase; UX143, a human monoclonal antibody for the treatment of osteogenesis imperfecta; GTX-102, an antisense oligonucleotide for the treatment of Angelman syndrome; UX111, an AAV9 gene therapy product candidate for the treatment of patients with Sanfilippo syndrome type A, or MPS IIIA, a rare lysosomal storage disease; UX701, for the treatment of Wilson disease; and UX053 for the treatment of glycogen storage disease type III. Ultragenyx Pharmaceutical Inc. has collaboration and license agreement with Kyowa Kirin Co., Ltd.; Saint Louis University; Baylor Research Institute; REGENXBIO Inc.; Bayer Healthcare LLC; GeneTx; Mereo; University of Pennsylvania; Arcturus Therapeutics Holdings Inc.; Solid Biosciences Inc.; Regeneron; Abeona; and Daiichi Sankyo Co., Ltd. The company was incorporated in 2010 and is headquartered in Novato, California.