Critical Comparison: Adagene (NASDAQ:ADAG) and KALA BIO (NASDAQ:KALA)

KALA BIO (NASDAQ:KALA) and Adagene (NASDAQ:ADAG) are both small-cap medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Risk and Volatility

KALA BIO has a beta of -2.43, indicating that its share price is 343% less volatile than the S&P 500. Comparatively, Adagene has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Insider & Institutional Ownership

24.6% of KALA BIO shares are held by institutional investors. Comparatively, 9.5% of Adagene shares are held by institutional investors. 2.2% of KALA BIO shares are held by company insiders. Comparatively, 21.2% of Adagene shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares KALA BIO and Adagene”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KALA BIO	N/A	N/A	-$38.51 million	($5.93)	-0.07
Adagene	$100,000.00	1,501.56	-$33.42 million	N/A	N/A

Adagene has higher revenue and earnings than KALA BIO.

Analyst Recommendations

This is a breakdown of current recommendations for KALA BIO and Adagene, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KALA BIO	1	4	1	0	2.00
Adagene	1	0	2	2	3.00

KALA BIO presently has a consensus price target of $20.38, suggesting a potential upside of 4,881.66%. Adagene has a consensus price target of $7.67, suggesting a potential upside of 140.64%. Given KALA BIO’s higher possible upside, equities research analysts plainly believe KALA BIO is more favorable than Adagene.

Profitability

This table compares KALA BIO and Adagene’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KALA BIO	N/A	-2,323.94%	-86.99%
Adagene	N/A	N/A	N/A

Summary

Adagene beats KALA BIO on 9 of the 11 factors compared between the two stocks.

About KALA BIO

KALA BIO, Inc., a clinical-stage biopharmaceutical company, engages in the research, development, and commercialization of innovative therapies for rare and severe eye diseases in the United States. The company's product candidates include KPI-012, which is in Phase 2b clinical trial for the treatment of persistent corneal epithelial defects. Its preclinical development product, including KPI-014 for the treatment of rare inherited retinal diseases. The company was formerly known as Kala Pharmaceuticals, Inc. and changed its name to KALA BIO, Inc. in August 2023. KALA BIO, Inc. was incorporated in 2009 and is headquartered in Arlington, Massachusetts.

About Adagene

Adagene Inc., a clinical stage biotechnology company, engages in the research, development, and production of monoclonal antibody drugs for cancers. The company's product candidates include ADG106, a human ligand-blocking agonistic anti- CD137 IgG4 monoclonal antibodies (mAbs) that is in Phase 1b/2 clinical trials for the treatment advanced solid tumors and non-Hodgkin's lymphoma; ADG126, a masked fully-human anti-CTLA-4 mAb that is in Phase 1 clinical trial for the treatment advanced/metastatic solid tumors; and ADG116, a human ligand-blocking anti-CTLA-4 mAb, which is in Phase 1b/2 clinical development for the treatment of advanced/metastatic solid tumors. It also offers ADG104, an anti-PD-L1 mAb that is in Phase 2 clinical development; ADG125, a novel anti-CSF-1R mAb, which is in Phase I clinical trial; ADG206, a masked, Fc engineered anti-CD137 agonistic POWERbody; ADG153, a masked anti-CD47 IgG1 SAFEbody, which is in preclinical for the treatment hematologic and solid tumors; ADG138, novel HER2xCD3 POWERbody, which is in preclinical for the treatment HER2-expressing solid tumors; and ADG152, a v POWERbody, which is in preclinical stage for the treatment off-tumor toxicities, as well as develops anti-CD28 bispecific POWERbody TCEs. The company was incorporated in 2011 and is headquartered in Suzhou, China.