Foundation Medicine (NASDAQ: FMI) is one of 207 publicly-traded companies in the “Biotechnology & Medical Research” industry, but how does it compare to its rivals? We will compare Foundation Medicine to similar businesses based on the strength of its valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Institutional & Insider Ownership

31.9% of Foundation Medicine shares are owned by institutional investors. Comparatively, 46.9% of shares of all “Biotechnology & Medical Research” companies are owned by institutional investors. 2.7% of Foundation Medicine shares are owned by insiders. Comparatively, 13.8% of shares of all “Biotechnology & Medical Research” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and target prices for Foundation Medicine and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Foundation Medicine 0 1 2 0 2.67
Foundation Medicine Competitors 490 2371 6429 121 2.66

Foundation Medicine currently has a consensus target price of $35.00, suggesting a potential downside of 33.01%. As a group, “Biotechnology & Medical Research” companies have a potential upside of 5.82%. Given Foundation Medicine’s rivals higher probable upside, analysts clearly believe Foundation Medicine has less favorable growth aspects than its rivals.

Profitability

This table compares Foundation Medicine and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Foundation Medicine -119.69% -143.18% -93.58%
Foundation Medicine Competitors -3,959.40% -119.48% -44.27%

Valuation and Earnings

This table compares Foundation Medicine and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Foundation Medicine $116.86 million -$113.19 million -11.69
Foundation Medicine Competitors $220.75 million -$39.68 million -0.64

Foundation Medicine’s rivals have higher revenue and earnings than Foundation Medicine. Foundation Medicine is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

Foundation Medicine has a beta of -0.09, indicating that its stock price is 109% less volatile than the S&P 500. Comparatively, Foundation Medicine’s rivals have a beta of 1.57, indicating that their average stock price is 57% more volatile than the S&P 500.

Summary

Foundation Medicine rivals beat Foundation Medicine on 10 of the 12 factors compared.

About Foundation Medicine

Foundation Medicine, Inc. is a molecular information company. The Company sells products that are enabled by its molecular information platform to physicians and biopharmaceutical companies. It is engaged in the business of delivering molecular information about cancer to its customers. Its platform includes various methods and algorithms for analyzing specimens across various types of cancer. Its suite of clinical molecular information products includes FoundationOne, which is used for solid tumors; FoundationOne Heme, which is used for blood-based cancers or hematologic malignancies, including leukemia, lymphoma, myeloma, pediatric cancers and advanced sarcoma; FoundationACT (Assay for Circulating Tumor DNA), which is a blood-based (liquid biopsy) assay that evaluates circulating tumor deoxyribonucleic acid (ctDNA), and FoundationFocus CDxBRCA, which is a companion diagnostic assay to aid in identifying women with ovarian cancer for whom treatment with Rubraca (rucaparib).

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