Financial Analysis: Cerus (NASDAQ:CERS) vs. Phibro Animal Health (NASDAQ:PAHC)

Cerus (NASDAQ:CERS) and Phibro Animal Health (NASDAQ:PAHC) are both small-cap medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, profitability, risk and earnings.

Insider and Institutional Ownership

78.4% of Cerus shares are held by institutional investors. Comparatively, 99.3% of Phibro Animal Health shares are held by institutional investors. 3.4% of Cerus shares are held by insiders. Comparatively, 50.1% of Phibro Animal Health shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

Cerus has a beta of 1.77, indicating that its stock price is 77% more volatile than the S&P 500. Comparatively, Phibro Animal Health has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Cerus and Phibro Animal Health, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cerus	1	1	2	0	2.25
Phibro Animal Health	1	4	2	0	2.14

Cerus currently has a consensus price target of $4.00, suggesting a potential upside of 55.04%. Phibro Animal Health has a consensus price target of $38.80, suggesting a potential upside of 18.84%. Given Cerus’ stronger consensus rating and higher possible upside, analysts plainly believe Cerus is more favorable than Phibro Animal Health.

Profitability

This table compares Cerus and Phibro Animal Health’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cerus	-4.41%	-15.18%	-4.38%
Phibro Animal Health	6.35%	37.14%	8.57%

Earnings & Valuation

This table compares Cerus and Phibro Animal Health”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cerus	$206.13 million	2.51	-$15.63 million	($0.05)	-51.60
Phibro Animal Health	$1.30 billion	1.02	$48.26 million	$2.33	14.01

Phibro Animal Health has higher revenue and earnings than Cerus. Cerus is trading at a lower price-to-earnings ratio than Phibro Animal Health, indicating that it is currently the more affordable of the two stocks.

Summary

Phibro Animal Health beats Cerus on 9 of the 13 factors compared between the two stocks.

About Cerus

Cerus Corporation operates as a biomedical products company. The company focuses on developing and commercializing the INTERCEPT Blood System to enhance blood safety. Its INTERCEPT Blood System, a proprietary technology for controlling biological replication that is designed to reduce blood-borne pathogens in donated blood components intended for transfusion. The company offers INTERCEPT Blood Systems for platelets and plasma, which is designed to inactivate blood-borne pathogens in platelets and plasma donated for transfusion; INTERCEPT Blood System for red blood cells to inactivate blood-borne pathogens in red blood cells donated for transfusion; and INTERCEPT Blood System for Cryoprecipitation that uses its plasma system to produce pathogen reduced cryoprecipitated fibrinogen complex for the treatment and control of bleeding, including massive hemorrhage associated with fibrinogen deficiency, as well as pathogen reduced plasma, cryoprecipitate reduced. It sells platelet and plasma systems through its direct sales force and distributors in the United States, Europe, the Commonwealth of Independent States, the Middle East, Latin America, and internationally. Cerus Corporation was incorporated in 1991 and is headquartered in Concord, California.

About Phibro Animal Health

Phibro Animal Health Corporation operates as an animal health and mineral nutrition company in the United States, Israel, Brazil, Ireland, and internationally. It operates through three segments: Animal Health, Mineral Nutrition, and Performance Products. The company develops, manufactures, and markets various products for food and companion animals including poultry, swine, beef and dairy cattle, aquaculture, and dogs. It also offers animal health products, such as antibacterials, anticoccidials, nutritional specialty, and vaccines and vaccine adjuvants for animal’s health and performance, food safety, and animal welfare; and engages in development, manufacturing, and marketing of microbial and bioproducts for various applications serving animal health and nutrition, environmental, industrial, and agricultural customers. In addition, the company develops, manufactures, and markets conventionally licensed and autogenous vaccine products, as well as adjuvants for animal vaccine manufacturers. Further, it provides formulations and concentrations of trace minerals, such as zinc, manganese, copper, iron, and other compounds to fortify the daily feed requirements of their livestock’s diets and maintain optimal balance of trace elements in animals. Additionally, the company offers specialty ingredients for personal care, industrial chemical, and chemical catalyst industries. It sells its animal health and mineral nutrition products through local sales offices to integrated poultry, swine, and cattle producers, as well as through commercial animal feed manufacturers, wholesalers, and distributors. The company was formerly known as Philipp Brothers Chemicals, Inc. and changed its name to Phibro Animal Health Corporation in July 2003. Phibro Animal Health Corporation was founded in 1946 and is headquartered in Teaneck, New Jersey.