Sonoma Pharmaceuticals (NASDAQ: SNOA) and Kadmon Holdings (NASDAQ:KDMN) are both small-cap medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.

Analyst Recommendations

This is a summary of current recommendations and price targets for Sonoma Pharmaceuticals and Kadmon Holdings, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sonoma Pharmaceuticals 0 0 1 0 3.00
Kadmon Holdings 0 2 4 0 2.67

Sonoma Pharmaceuticals presently has a consensus price target of $10.00, suggesting a potential upside of 76.37%. Kadmon Holdings has a consensus price target of $9.85, suggesting a potential upside of 298.79%. Given Kadmon Holdings’ higher possible upside, analysts clearly believe Kadmon Holdings is more favorable than Sonoma Pharmaceuticals.

Institutional & Insider Ownership

9.8% of Sonoma Pharmaceuticals shares are owned by institutional investors. 13.3% of Sonoma Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Sonoma Pharmaceuticals and Kadmon Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Sonoma Pharmaceuticals $14.02 million 1.74 -$12.55 million $1.99 2.85
Kadmon Holdings $18.50 million 6.92 -$97.68 million N/A N/A

Sonoma Pharmaceuticals has higher revenue, but lower earnings than Kadmon Holdings.

Profitability

This table compares Sonoma Pharmaceuticals and Kadmon Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sonoma Pharmaceuticals 54.36% -44.24% -36.04%
Kadmon Holdings -754.62% N/A -155.28%

Summary

Sonoma Pharmaceuticals beats Kadmon Holdings on 6 of the 11 factors compared between the two stocks.

Sonoma Pharmaceuticals Company Profile

Sonoma Pharmaceuticals, Inc., formerly Oculus Innovative Sciences, Inc., is a specialty pharmaceutical company that develops and markets solutions for the treatment of dermatological conditions and advanced tissue care. The Company’s product portfolio consists of dermatology and advanced tissue care products based upon its technologies, such as Microcyn and Lipogrid. Microcyn is a small-molecule oxychlorine compound with antimicrobial and anti-inflammatory properties that, in clinical settings, reduces itch and pain associated with dermal irritations and wounds, such as sores, injuries and ulcers of dermal tissue. Lipogrid Technology contains selected lipids and a lipid precursor designed to penetrate the bilayers of the skin by blending with the natural lipid building blocks. Its products serve over five million patients across the globe by reducing infections, itch, pain, scarring and inflammatory responses. Its products are sold throughout the United States and internationally.

Kadmon Holdings Company Profile

Kadmon Holdings, Inc. is an integrated biopharmaceutical company engaged in the discovery, development and commercialization of small molecules and biologics to address disease areas of various unmet medical needs. The Company is developing product candidates in a number of indications within autoimmune and fibrotic disease, oncology and genetic diseases. Its product pipeline consists of KD025, Tesevatinib and KD034. The Company’s other products include Ribasphere RibaPak, Ribasphere, Qsymia, Tetrabenazine and Valganciclovir. KD025 is an orally available, selective small molecule inhibitor of Rho-associated coiled-coil kinase 2 (ROCK2), a molecular target in multiple autoimmune, fibrotic and neurodegenerative diseases. Tesevatinib is an oral tyrosine kinase inhibitor (TKI) designed to block key molecular drivers of tumor growth, metastases and drug resistance. KD034 is the Company’s portfolio of enhanced formulations of trientine hydrochloride for the treatment of Wilson’s disease.

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