Heron Therapeutics (NASDAQ:HRTX – Get Free Report) and Collegium Pharmaceutical (NASDAQ:COLL – Get Free Report) are both small-cap healthcare companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, institutional ownership, earnings and profitability.
Volatility and Risk
Heron Therapeutics has a beta of 1.61, suggesting that its stock price is 61% more volatile than the S&P 500. Comparatively, Collegium Pharmaceutical has a beta of 0.72, suggesting that its stock price is 28% less volatile than the S&P 500.
Institutional and Insider Ownership
80.0% of Heron Therapeutics shares are owned by institutional investors. 6.1% of Heron Therapeutics shares are owned by company insiders. Comparatively, 1.9% of Collegium Pharmaceutical shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Heron Therapeutics | $154.90 million | 0.37 | -$20.19 million | ($0.19) | -1.57 |
| Collegium Pharmaceutical | $780.57 million | 0.95 | $62.87 million | $1.24 | 18.37 |
Collegium Pharmaceutical has higher revenue and earnings than Heron Therapeutics. Heron Therapeutics is trading at a lower price-to-earnings ratio than Collegium Pharmaceutical, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of current ratings and price targets for Heron Therapeutics and Collegium Pharmaceutical, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Heron Therapeutics | 1 | 3 | 1 | 0 | 2.00 |
| Collegium Pharmaceutical | 1 | 2 | 5 | 0 | 2.50 |
Heron Therapeutics currently has a consensus price target of $2.00, indicating a potential upside of 568.90%. Collegium Pharmaceutical has a consensus price target of $48.50, indicating a potential upside of 112.91%. Given Heron Therapeutics’ higher probable upside, analysts clearly believe Heron Therapeutics is more favorable than Collegium Pharmaceutical.
Profitability
This table compares Heron Therapeutics and Collegium Pharmaceutical’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Heron Therapeutics | -22.52% | -293.02% | -10.00% |
| Collegium Pharmaceutical | 5.93% | 91.43% | 15.57% |
Summary
Collegium Pharmaceutical beats Heron Therapeutics on 10 of the 14 factors compared between the two stocks.
About Heron Therapeutics
Heron Therapeutics, Inc., a commercial-stage biotechnology company, focuses on enhancing the lives of patients by developing and commercializing therapeutic that enhances medical care. The company's product candidates utilize its proprietary Biochronomer, a drug delivery technology, which delivers therapeutic levels of a range of short-acting pharmacological agents over a period from days to weeks with a single administration. It offers SUSTOL (granisetron), an extended-release injection for the prevention of acute and delayed nausea and vomiting associated with moderately emetogenic chemotherapy, or anthracycline and cyclophosphamide combination chemotherapy regimens; and CINVANTI, an intravenous formulation of aprepitant, a substance P/neurokinin-1 receptor antagonist for the prevention of acute and delayed nausea and vomiting associated with highly emetogenic cancer chemotherapy, as well as nausea and vomiting associated with moderately emetogenic cancer chemotherapy. The company is also developing ZYNRELEF, a dual-acting local anesthetic that delivers a fixed-dose combination of the local anesthetic bupivacaine and a low dose of the nonsteroidal anti-inflammatory drug meloxicam; and APONVIE, an intravenous formulation of a substance P/neurokinin-1 receptor antagonist indicated for the prevention of postoperative nausea and vomiting in adults. The company was formerly known as A.P. Pharma, Inc. and changed its name to Heron Therapeutics, Inc. in January 2014. Heron Therapeutics, Inc. was founded in 1983 and is headquartered in San Diego, California.
About Collegium Pharmaceutical
Collegium Pharmaceutical, Inc., a specialty pharmaceutical company, engages in the development and commercialization of medicines for pain management. Its portfolio includes Xtampza ER, an abuse-deterrent, extended-release, and oral formulation of oxycodone for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment; Nucynta ER and Nucynta IR, which are extended-release and immediate-release formulations of tapentadol, indicated for the management of acute, severe, and persistent pain; Belbuca, a buccal film that contains buprenorphine; and Symproic, an oral formulation of naldemedine for the treatment of opioid-induced constipation in adult patients with chronic non-cancer pain. The company was formerly known as Collegium Pharmaceuticals, Inc. and changed its name to Collegium Pharmaceutical, Inc. in October 2003. Collegium Pharmaceutical, Inc. was incorporated in 2002 and is headquartered in Stoughton, Massachusetts.
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