Critical Analysis: Adial Pharmaceuticals (NASDAQ:ADIL) vs. Eledon Pharmaceuticals (NASDAQ:ELDN)

Adial Pharmaceuticals (NASDAQ:ADIL – Get Rating) and Eledon Pharmaceuticals (NASDAQ:ELDN – Get Rating) are both small-cap medical companies, but which is the better business? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Risk & Volatility

Adial Pharmaceuticals has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500. Comparatively, Eledon Pharmaceuticals has a beta of 2.04, meaning that its share price is 104% more volatile than the S&P 500.

Insider & Institutional Ownership

7.4% of Adial Pharmaceuticals shares are held by institutional investors. Comparatively, 45.6% of Eledon Pharmaceuticals shares are held by institutional investors. 21.2% of Adial Pharmaceuticals shares are held by company insiders. Comparatively, 13.8% of Eledon Pharmaceuticals shares are held by company 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.

Profitability

This table compares Adial Pharmaceuticals and Eledon Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Adial Pharmaceuticals	N/A	-227.60%	-156.55%
Eledon Pharmaceuticals	N/A	-25.14%	-24.13%

Analyst Ratings

This is a summary of current ratings and recommmendations for Adial Pharmaceuticals and Eledon Pharmaceuticals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Adial Pharmaceuticals	0	1	1	0	2.50
Eledon Pharmaceuticals	0	0	4	0	3.00

Adial Pharmaceuticals currently has a consensus target price of $3.00, suggesting a potential upside of 631.71%. Eledon Pharmaceuticals has a consensus target price of $22.00, suggesting a potential upside of 886.55%. Given Eledon Pharmaceuticals’ stronger consensus rating and higher probable upside, analysts plainly believe Eledon Pharmaceuticals is more favorable than Adial Pharmaceuticals.

Earnings & Valuation

This table compares Adial Pharmaceuticals and Eledon Pharmaceuticals’ top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Adial Pharmaceuticals	N/A	N/A	-$19.42 million	($0.69)	-0.59
Eledon Pharmaceuticals	N/A	N/A	-$34.51 million	($2.66)	-0.84

Eledon Pharmaceuticals is trading at a lower price-to-earnings ratio than Adial Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Summary

Eledon Pharmaceuticals beats Adial Pharmaceuticals on 7 of the 11 factors compared between the two stocks.

About Adial Pharmaceuticals

(Get Rating)

Adial Pharmaceuticals, Inc. operates as a clinical stage biopharmaceutical company, which focuses on the treatment of alcohol use disorder. Its lead product is AD04, a selective serotonin-3 antagonist. The company was founded by Bankole A. Johnson in November 2010 and is headquartered in Charlottesville, VA.

About Eledon Pharmaceuticals

(Get Rating)

Eledon Pharmaceuticals, Inc. is a clinical stage biotechnology company using its expertise in targeting the CD40L pathway to develop potential treatments for people requiring an organ or cellular transplant, and for people living with autoimmune and neurodegenerative disease. The firm’s compound in development is AT-1501, a humanized IgG1 anti-CD40L antibody with high affinity for CD40 ligand (CD40L, also called CD154), a well-validated biological target with broad therapeutic potential. The CD40L/CD40 pathway is recognized for its prominent role in immune regulation, making it a candidate for therapeutic intervention in transplant tolerance, autoimmune disease, and neuro-inflammation. The company is building upon a deep historical understanding of the CD40/CD40L pathway, as well as preclinical and Phase 1 data, to initiate up to four phase 2 clinical studies with AT-1501. Eledon Pharmaceuticals was founded on March 26, 2004 and is headquartered in Irvine, CA.