Financial Analysis: Shattuck Labs (NASDAQ:STTK) and Veracyte (NASDAQ:VCYT)

Shattuck Labs (NASDAQ:STTK) and Veracyte (NASDAQ:VCYT) are both healthcare companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Risk & Volatility

Shattuck Labs has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Veracyte has a beta of 1.93, indicating that its share price is 93% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Shattuck Labs and Veracyte, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shattuck Labs	1	0	9	2	3.00
Veracyte	1	2	6	2	2.82

Shattuck Labs presently has a consensus target price of $12.78, suggesting a potential upside of 100.91%. Veracyte has a consensus target price of $55.78, suggesting a potential upside of 29.63%. Given Shattuck Labs’ stronger consensus rating and higher probable upside, research analysts clearly believe Shattuck Labs is more favorable than Veracyte.

Earnings & Valuation

This table compares Shattuck Labs and Veracyte”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shattuck Labs	$1.00 million	638.29	-$48.81 million	($0.51)	-12.47
Veracyte	$517.15 million	6.69	$66.35 million	$1.41	30.52

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

Profitability

This table compares Shattuck Labs and Veracyte’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shattuck Labs	N/A	-43.57%	-40.90%
Veracyte	20.37%	9.26%	8.61%

Institutional and Insider Ownership

58.7% of Shattuck Labs shares are held by institutional investors. 8.8% of Shattuck Labs shares are held by insiders. Comparatively, 1.6% of Veracyte shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Veracyte beats Shattuck Labs on 8 of the 14 factors compared between the two stocks.

About Shattuck Labs

Shattuck Labs, Inc., a clinical-stage biotechnology company, develops therapeutics for the treatment of cancer and autoimmune disease in the United States. The company's lead product candidate is SL-172154, which is in Phase 1 clinical trial for the treatment of ovarian, fallopian tube, and peritoneal cancers. Shattuck Labs, Inc. was incorporated in 2016 and is headquartered in Austin, Texas.

About Veracyte

Veracyte, Inc. engages in the research, development and commercialization of diagnostic products. The firm’s portfolio includes Afirma, Percepta, and Envisia. It intends to treat thyroid cancer, improve lung cancer screening, and clarify the diagnosis of idiopathic pulmonary fibrosis. The company was founded by Bonnie H. Anderson and Y. Douglas Dolginow on August 15, 2006 and is headquartered in South San Francisco, CA.