Financial Analysis: Arcus Biosciences (RCUS) versus The Competition

Arcus Biosciences (NYSE:RCUS) is one of 844 publicly-traded companies in the “Biotechnology” industry, but how does it contrast to its peers? We will compare Arcus Biosciences to similar businesses based on the strength of its earnings, valuation, profitability, dividends, institutional ownership, analyst recommendations and risk.

Institutional & Insider Ownership

92.9% of Arcus Biosciences shares are held by institutional investors. Comparatively, 47.9% of shares of all “Biotechnology” companies are held by institutional investors. 7.6% of Arcus Biosciences shares are held by insiders. Comparatively, 13.0% of shares of all “Biotechnology” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Arcus Biosciences and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arcus Biosciences	-453.00%	-83.94%	-44.41%
Arcus Biosciences Competitors	-12,359.35%	-203.09%	-30.93%

Risk and Volatility

Arcus Biosciences has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500. Comparatively, Arcus Biosciences’ peers have a beta of 1.15, indicating that their average stock price is 15% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Arcus Biosciences and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arcus Biosciences	1	3	12	0	2.69
Arcus Biosciences Competitors	9846	15126	45471	1588	2.54

Arcus Biosciences currently has a consensus price target of $39.36, suggesting a potential upside of 108.26%. As a group, “Biotechnology” companies have a potential upside of 98.49%. Given Arcus Biosciences’ stronger consensus rating and higher possible upside, analysts clearly believe Arcus Biosciences is more favorable than its peers.

Earnings & Valuation

This table compares Arcus Biosciences and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Arcus Biosciences	$247.00 million	-$353.00 million	-5.21
Arcus Biosciences Competitors	$698.08 million	$10.43 million	-15.42

Arcus Biosciences’ peers have higher revenue and earnings than Arcus Biosciences. Arcus Biosciences is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Arcus Biosciences beats its peers on 7 of the 13 factors compared.

Arcus Biosciences Company Profile

Arcus Biosciences, Inc., a clinical-stage biopharmaceutical company, develops and commercializes cancer therapies in the United States. The company's pipeline products include Domvanalimab, an anti-TIGIT antibody, which is in Phase 2 and Phase 3 clinical trial; and AB308, an investigational anti-TIGIT monoclonal antibody, which is in Phase 1b clinical trial to study people with advanced solid and hematologic malignancies. It also develops Etrumadenant, a dual A2a/A2b adenosine receptor antagonist, which is in Phase 2 clinical trial; Quemliclustat, a small-molecule CD73 inhibitor, which is Phase 1b and Phase 2 clinical trial; Zimberelimab, an anti-PD-1 antibody, which is in Phase 2 clinical trial for metastatic cell lung cancer and monotherapy; and AB521, an oral and small-molecule inhibitor of HIF-2a, which is in Phase 1 clinical trial for the treatment of Von Hippel-Lindau disease. In addition, the company's preclinical pipeline products include AB598, a CD39 antibody; and AB801, a small molecule Axl inhibitor. It has a clinical collaboration with AstraZeneca to evaluate domvanalimab in combination with durvalumab in a registrational phase 3 clinical trial in patients with unresectable Stage 3 NSCLC; and BVF Partners L.P. to support the discovery and development of compounds for the treatment of inflammatory diseases. Arcus Biosciences, Inc. was incorporated in 2015 and is headquartered in Hayward, California.