When it comes to high-flying cryptocurrencies, Shiba Inu (SHIB 1.85%) is among the most visible. Fueled by a frenzy of speculative buying late last year, the cheerful memes minted by the coin's community, known as the Shiba Army, are doubtlessly one of its enduring appeals. However, if you aren't in love with the memes, you might come up short for other reasons to buy Shiba Inu, as its price has been down by more than 60% since its peak in late October.
On the other hand, you probably haven't heard of Corcept Therapeutics (CORT 3.14%), a biotech company that's worth just over $2.6 billion. It's certainly not a meme stock, and its chances of ever being in the spotlight are close to nil. But I believe that this little-known drug developer is a better buy than Shiba Inu at the moment -- here are three reasons why.
Image source: Getty Images.
1. It's making more money every quarter
The single biggest difference between Shiba Inu coin and Corcept is that Corcept is a profitable company constantly striving to increase in value through its medicine sales.
Corcept has one drug on the market, Korlym, which treats Cushing's syndrome. It also has a handful of ongoing clinical trials for new drugs that treat various cancers and metabolic diseases like diabetes. In 2021, sales of Korlym brought in $366 million, and this year management predicts it could earn as much as $430 million.
Of course, 2021 sales weren't a significant increase over 2020 sales of $353.9 million, but that's not a deal-breaker versus the likes of Shiba Inu -- the coin isn't capable of making money because it has no operations to speak of.
2. It's robust in the face of market downturns and uncertainty
A lack of useful financial performance metrics means that Shiba Inu's value is purely based on the level of widespread enthusiasm for it. So, it's doomed to be highly volatile, and there's not much that investors can do to determine if they're getting a good bargain at any specific price point.
In contrast, even with its plodding pace of revenue growth, there's enough financial information about Corcept for the market to determine its valuation. And, as it isn't fodder for memes, it'll remain far less volatile as it expands in value over time, and that's a big point in its favor.
And while Shiba Inu holders like myself will likely need to stomach severe downturns without any reasonable hope for a rebound, Corcept is a company that's consistently generating free cash flow (FCF). Therefore, investors can have some confidence that it'll recover when there's a downturn in the market.
During the coronavirus crash of 2020, Corcept's shares lost less value and recovered faster than the broader market. However, it's hard to see how Shiba Inu coin could accomplish anything similar with the force of memes alone.
Data by YCharts.
3. There's a (good) plan for the future
The final reason why Corcept is a better buy than Shiba Inu coin is that there's a clear roadmap for the company to keep increasing its value for shareholders.
While there are several projects and updates in the works with the Shiba Inu ecosystem, there's no single leader at the helm who's organizing all of the efforts. That makes it quite hard for the cryptocurrency as a whole to differentiate itself and gain long-term adoption.
In Corcept's case, the opposite is true.
The biotech has a management team, and it also has a development pipeline that's focused on making new drugs within the company's area of competency.
That area of competency is the molecule cortisol, a stress hormone with a plethora of different physiological functions. Thanks to its success with Korlym, the company has a credible claim to being experienced with developing drugs that modulate cortisol, so it's reasonable to believe that its ongoing efforts to make new therapies have a shot at working out.
Likewise, if its ongoing clinical trials succeed, it'll deepen its experience and improve its reputation in the cortisol space even further. Plus, it'll make even more money than it's making right now, which will almost certainly drive its share price higher.
If that's not a reason why it's a better purchase than Shiba Inu, not much else is.
