Head to Head Analysis: Precision BioSciences (NASDAQ:DTIL) vs. Erasca (NASDAQ:ERAS)

Erasca (NASDAQ:ERAS) and Precision BioSciences (NASDAQ:DTIL) are both small-cap medical companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, risk, dividends, analyst recommendations, earnings and valuation.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Erasca and Precision BioSciences, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Erasca	2	1	6	0	2.44
Precision BioSciences	1	0	2	0	2.33

Erasca currently has a consensus target price of $4.25, indicating a potential upside of 64.73%. Precision BioSciences has a consensus target price of $47.00, indicating a potential upside of 699.32%. Given Precision BioSciences’ higher possible upside, analysts plainly believe Precision BioSciences is more favorable than Erasca.

Risk and Volatility

Erasca has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500. Comparatively, Precision BioSciences has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500.

Profitability

This table compares Erasca and Precision BioSciences’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Erasca	N/A	-33.10%	-27.76%
Precision BioSciences	-11,977.36%	-233.77%	-78.93%

Insider and Institutional Ownership

67.8% of Erasca shares are held by institutional investors. Comparatively, 38.0% of Precision BioSciences shares are held by institutional investors. 14.4% of Erasca shares are held by insiders. Comparatively, 4.5% of Precision BioSciences shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Erasca and Precision BioSciences”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Erasca	N/A	N/A	-$161.65 million	($0.45)	-5.73
Precision BioSciences	$68.70 million	1.13	$7.17 million	($8.40)	-0.70

Precision BioSciences has higher revenue and earnings than Erasca. Erasca is trading at a lower price-to-earnings ratio than Precision BioSciences, indicating that it is currently the more affordable of the two stocks.

Summary

Erasca beats Precision BioSciences on 8 of the 13 factors compared between the two stocks.

About Erasca

Erasca, Inc., a clinical-stage precision oncology company, focuses on discovering, developing, and commercializing therapies for patients with RAS/MAPK pathway-driven cancers. The company’s lead product is naporafenib which is in phase 1b trial for patients with RAS Q16X solid tumors and plans to initiate a pivotal Phase 3 trial for patients with NRASm melanoma. It also develops ERAS-007, an oral inhibitor of ERK1/2 for the treatment of non-small cell lung and colorectal cancer, and advanced gastrointestinal malignancies; and ERAS-601, an oral SHP2 inhibitor for patients with advanced or metastatic solid tumors. In addition, it is developing ERAS-801, a central nervous system-penetrant EGFR inhibitor which is in phase 1 clinical trials for the treatment of patients with recurrent glioblastoma multiforme. The company entered into license agreement with Novartis to develop, manufacture, use, and commercialize naporafenib; Katmai Pharmaceuticals, Inc. to develop, manufacture, use, and commercialize ERAS-801 and certain other related compounds; and NiKang Therapeutics, Inc. to develop and commercialize ERAS-601 and certain other related compounds. Erasca, Inc. was incorporated in 2018 and is headquartered in San Diego, California.

About Precision BioSciences

Precision BioSciences, Inc., an advanced gene editing company, develops in vivo gene editing therapies for gene edits, including gene elimination, insertion, and excision in the United States. The company offers ARCUS, a genome editing platform to DNA genome insertion, deletion, and repair. It also provides PBGENE-HBV for the treatment of chronic hepatitis B virus (HBV) to eliminate covalently closed circular DNA with direct cuts and edits as well as to inactivate integrated HBV DNA with the goal of long-lasting reductions in hepatitis B surface antigen; PBGENE-PMM for the treatment of m.3243 associated primary mitochondrial myopathy (PMM) which is expected to submit an IND and/or CTA. In addition, it develops PBGENE-NVS for sickle cell disease/beta thalassemia for insertion; PBGENE-DMD (excision) for duchenne muscular dystrophy; PBGENE-LL2 (insertion), a liver directed target; PBGENE-LL3, a central nervous system directed target; and iECURE-OTC (insertion) for ornithine transcarbamylase deficiency. The company has license and collaboration agreement with Caribou Biosciences, Inc.; license agreement with TG Cell Therapy, Inc. to develop, manufacture, and commercialize azer-cel for autoimmune diseases and other indications outside of cancer; development and license agreement with Eli Lilly and Company for the research and development of potential in vivo therapies for genetic disorders; Cellectis S.A.; iECURE, Inc. to develop ARCUS-based gene-insertion therapies; Duke University; and Novartis Pharma AG to discover and develop in vivo gene editing products. Precision BioSciences, Inc. was incorporated in 2006 and is headquartered in Durham, North Carolina.