Critical Contrast: Omega Therapeutics (NASDAQ:OMGA) & Recursion Pharmaceuticals (NASDAQ:RXRX)

Omega Therapeutics (NASDAQ:OMGA) and Recursion Pharmaceuticals (NASDAQ:RXRX) are both medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Omega Therapeutics and Recursion Pharmaceuticals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Omega Therapeutics	0	1	4	0	2.80
Recursion Pharmaceuticals	0	3	2	0	2.40

Omega Therapeutics presently has a consensus price target of $9.20, suggesting a potential upside of 7,260.00%. Recursion Pharmaceuticals has a consensus price target of $8.25, suggesting a potential upside of 55.95%. Given Omega Therapeutics’ stronger consensus rating and higher probable upside, research analysts clearly believe Omega Therapeutics is more favorable than Recursion Pharmaceuticals.

Risk & Volatility

Omega Therapeutics has a beta of 1.65, suggesting that its stock price is 65% more volatile than the S&P 500. Comparatively, Recursion Pharmaceuticals has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500.

Profitability

This table compares Omega Therapeutics and Recursion Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Omega Therapeutics	-902.93%	-213.13%	-41.24%
Recursion Pharmaceuticals	-579.52%	-76.56%	-55.68%

Earnings & Valuation

This table compares Omega Therapeutics and Recursion Pharmaceuticals”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Omega Therapeutics	$8.10 million	0.85	-$97.43 million	($1.33)	-0.09
Recursion Pharmaceuticals	$58.49 million	36.36	-$328.07 million	($1.66)	-3.19

Omega Therapeutics has higher earnings, but lower revenue than Recursion Pharmaceuticals. Recursion Pharmaceuticals is trading at a lower price-to-earnings ratio than Omega Therapeutics, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

97.5% of Omega Therapeutics shares are owned by institutional investors. Comparatively, 89.1% of Recursion Pharmaceuticals shares are owned by institutional investors. 8.5% of Omega Therapeutics shares are owned by company insiders. Comparatively, 15.8% of Recursion Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Omega Therapeutics beats Recursion Pharmaceuticals on 9 of the 14 factors compared between the two stocks.

About Omega Therapeutics

Omega Therapeutics, Inc. operates as a clinical-stage biotechnology company. The company's OMEGA platform enables control of fundamental epigenetic processes to correct the root cause of disease by restoring aberrant gene expression to a range without altering native nucleic acid sequences. It also develops OTX-2002 for hepatocellular carcinoma; OTX-2101 for non-small cell lung cancer; omega epigenomic controllers (OEC) for inflammatory lung diseases, such as neutrophilic asthma, acute respiratory distress syndrome, dermatological, oncology, and rheumatological indications; OEC candidates for idiopathic pulmonary fibrosis; liver regeneration medicines; and OEC candidates for patients with diabetes and other conditions to treat corneal epithelial injury. In addition, the company develops OEC candidates for the treatment of alopecia, a disorder characterized by patches of non-scarring hair loss affecting the scalp and body. Omega Therapeutics, Inc. was incorporated in 2016 and is headquartered in Cambridge, Massachusetts.

About Recursion Pharmaceuticals

Recursion Pharmaceuticals, Inc. operates as a clinical-stage biotechnology company, engages in the decoding biology by integrating technological innovations across biology, chemistry, automation, data science, and engineering to industrialize drug discovery. The company develops REC-994, which is in Phase 2 clinical trial to treat cerebral cavernous malformation; REC-2282, which is in Phase 2/3 clinical trial for the treatment of neurofibromatosis type 2; REC-4881, which is in Phase 1b/2 clinical trial to treat familial adenomatous polyposis; REC-3964, which is in Phase 1 clinical trial to treat Clostridioides difficile infection; and REC-4881, which is in Phase 2 clinical trial to treat AXIN1 or APC mutant cancers. Its preclinical stage product includes RBM39 to treat HR-proficient ovarian cancer. The company has collaboration and agreement with Bayer AG; the University of Utah Research Foundation; Ohio State Innovation Foundation; Roche & Genentech; and Takeda Pharmaceutical Company Limited. Recursion Pharmaceuticals, Inc. was incorporated in 2013 and is headquartered in Salt Lake City, Utah.