Head to Head Review: ADC Therapeutics (NYSE:ADCT) & Atea Pharmaceuticals (NASDAQ:AVIR)

ADC Therapeutics (NYSE:ADCT) and Atea Pharmaceuticals (NASDAQ:AVIR) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, institutional ownership, risk, earnings, profitability, analyst recommendations and valuation.

Profitability

This table compares ADC Therapeutics and Atea Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ADC Therapeutics	-330.17%	-1,313.37%	-55.36%
Atea Pharmaceuticals	N/A	-29.18%	-27.48%

Earnings and Valuation

This table compares ADC Therapeutics and Atea Pharmaceuticals’ top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ADC Therapeutics	$69.56 million	3.21	-$240.05 million	($2.75)	-0.98
Atea Pharmaceuticals	$351.37 million	0.84	-$135.96 million	($1.96)	-1.78

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

Analyst Recommendations

This is a breakdown of recent ratings and target prices for ADC Therapeutics and Atea Pharmaceuticals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ADC Therapeutics	0	2	4	0	2.67
Atea Pharmaceuticals	1	0	0	0	1.00

ADC Therapeutics currently has a consensus target price of $7.25, indicating a potential upside of 169.02%. Given ADC Therapeutics’ stronger consensus rating and higher possible upside, analysts clearly believe ADC Therapeutics is more favorable than Atea Pharmaceuticals.

Volatility & Risk

ADC Therapeutics has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500. Comparatively, Atea Pharmaceuticals has a beta of 0.19, meaning that its share price is 81% less volatile than the S&P 500.

Insider & Institutional Ownership

41.1% of ADC Therapeutics shares are owned by institutional investors. Comparatively, 86.7% of Atea Pharmaceuticals shares are owned by institutional investors. 4.1% of ADC Therapeutics shares are owned by insiders. Comparatively, 17.8% of Atea Pharmaceuticals shares are owned by 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

Atea Pharmaceuticals beats ADC Therapeutics on 8 of the 14 factors compared between the two stocks.

About ADC Therapeutics

ADC Therapeutics SA focuses on advancing its proprietary antibody drug conjugate (ADC) technology platform to transform the treatment paradigm for patients with hematologic malignancies and solid tumors. Its flagship product is ZYNLONTA, a CD19-directed ADC, received accelerated approval from the U.S. Food and Drug Administration and conditional approval from the European Commission for the treatment of relapsed or refractory diffuse large B-cell lymphoma (DLBCL) after two or more lines of systemic therapy. The company is also seeking to continue expanding ZYNLONTA into international markets and into earlier lines of DLBCL and indolent lymphomas, including follicular lymphoma (FL) and marginal zone lymphoma (MZL) as a single agent and in combination through its LOTIS-5 confirmatory Phase 3 clinical trial and LOTIS-7 Phase 1b clinical trial, as well as through investigator-initiated trials (IITs). In addition, it is investigating a CD-22 targeted compound, ADCT-602 that is in a Phase 1/2 investigator-initiated study in relapsed or refractory B-cell acute lymphoblastic leukemia. Further, its clinical-stage pipeline consists of ADCT-601 (mipasetamab uzoptirine) targeting AXL as a single agent and/or in combination in sarcoma, pancreatic, and NSCLC, as well as pre-clinical stage pipeline includes a portfolio of next generation investigational ADCs targeting Claudin-6, NaPi2b, PSMA, and other undisclosed targets. The company was incorporated in 2011 and is headquartered in Epalinges, Switzerland.

About Atea Pharmaceuticals

Atea Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, discovers, develops, and commercializes antiviral therapeutics for patients with viral infections. Its lead product candidate is AT-527, an oral antiviral candidate that is in Phase 3 SUNRISE-3 clinical trial for the treatment of patients with COVID-19. The company also develops bemnifosbuvir in combination with ruzasvir, which is in Phase 2 clinical trial, for the treatment of hepatitis C virus (HCV); and a protease inhibitor for the treatment of COVID-19. It has a license agreement with MSD International GmbH for the development, manufacture, and commercialization of Ruzasvir, an NS5A inhibitor, for the treatment of HCV. Atea Pharmaceuticals, Inc. was incorporated in 2012 and is headquartered in Boston, Massachusetts.