Critical Analysis: Syneos Health (SYNH) and Senomyx (SNMX)

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Syneos Health (NASDAQ: SYNH) and Senomyx (NASDAQ:SNMX) are both medical companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, risk, earnings, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Syneos Health and Senomyx, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Syneos Health 0 2 7 0 2.78
Senomyx 0 0 0 0 N/A

Syneos Health currently has a consensus price target of $51.88, suggesting a potential upside of 5.54%. Given Syneos Health’s higher probable upside, equities analysts clearly believe Syneos Health is more favorable than Senomyx.

Profitability

This table compares Syneos Health and Senomyx’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Syneos Health -4.32% 7.80% 3.17%
Senomyx -9.11% -15.80% -10.48%

Insider & Institutional Ownership

30.3% of Senomyx shares are owned by institutional investors. 0.6% of Syneos Health shares are owned by insiders. Comparatively, 13.0% of Senomyx shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Syneos Health and Senomyx’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Syneos Health $2.67 billion 1.89 -$138.46 million $1.94 25.34
Senomyx $29.32 million 1.67 -$1.26 million ($0.03) -33.67

Senomyx has lower revenue, but higher earnings than Syneos Health. Senomyx is trading at a lower price-to-earnings ratio than Syneos Health, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Syneos Health has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500. Comparatively, Senomyx has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500.

Summary

Syneos Health beats Senomyx on 9 of the 13 factors compared between the two stocks.

About Syneos Health

Syneos Health, Inc. operates as an integrated biopharmaceutical solutions company in North America, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. It operates through two segments, Clinical Solutions and Commercial Solutions. The Clinical Solutions segment offers various clinical development services spanning Phase I to Phase IV, including full-service global studies, as well as unbundled service offerings, such as clinical monitoring, investigator recruitment, patient recruitment, data management, and study startup to assist customers with drug development process. The Commercial Solutions segment provides commercialization services, including outsourced field selling solutions, medication adherence, communications, and consulting services. Its customers include small, mid-sized, and large companies in the pharmaceutical, biotechnology, and medical device industries. Syneos Health, Inc. has a strategic collaboration with Elligo Health Research. The company was formerly known as INC Research Holdings, Inc. and changed its name to Syneos Health, Inc. in January 2018. Syneos Health, Inc. was incorporated in 2010 and is headquartered in Raleigh, North Carolina.

About Senomyx

Senomyx, Inc. discovers, develops, and commercializes flavor ingredients and natural high intensity sweeteners primarily for the packaged food, beverage, and ingredient supply industries in the United States. The company develops and/or commercializes sweet, savory and salt flavor ingredients, bitter blockers and cooling agents. It sells various flavor ingredients directly to flavor companies. The company has collaboration agreements with Ajinomoto Co., Inc.; Firmenich SA; and PepsiCo, Inc. Senomyx, Inc. was founded in 1998 and is headquartered in San Diego, California.

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