Amarin (NASDAQ:AMRN) and GW Pharmaceuticals (NASDAQ:GWPH) are both medical companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, risk, earnings, dividends, analyst recommendations, institutional ownership and valuation.
Profitability
This table compares Amarin and GW Pharmaceuticals' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Amarin | -2.69% | -2.70% | -1.72% |
GW Pharmaceuticals | -11.05% | -7.46% | -6.13% |
Valuation & Earnings
This table compares Amarin and GW Pharmaceuticals' revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Amarin | $429.76 million | 4.60 | $-22,650,000.00 | ($0.07) | -71.71 |
GW Pharmaceuticals | $311.33 million | 22.04 | $-9,020,000.00 | ($0.24) | -912.08 |
GW Pharmaceuticals has lower revenue, but higher earnings than Amarin. GW Pharmaceuticals is trading at a lower price-to-earnings ratio than Amarin, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Amarin has a beta of 2.58, meaning that its share price is 158% more volatile than the S&P 500. Comparatively, GW Pharmaceuticals has a beta of 2.15, meaning that its share price is 115% more volatile than the S&P 500.
Institutional and Insider Ownership
37.8% of Amarin shares are owned by institutional investors. Comparatively, 81.0% of GW Pharmaceuticals shares are owned by institutional investors. 2.8% of Amarin shares are owned by insiders. Comparatively, 3.1% of GW Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Amarin and GW Pharmaceuticals, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Amarin | 0 | 3 | 8 | 0 | 2.73 |
GW Pharmaceuticals | 0 | 10 | 4 | 0 | 2.29 |
Amarin presently has a consensus price target of $11.1818, suggesting a potential upside of 122.75%. GW Pharmaceuticals has a consensus price target of $204.0909, suggesting a potential downside of 6.77%. Given Amarin's stronger consensus rating and higher possible upside, research analysts plainly believe Amarin is more favorable than GW Pharmaceuticals.
Summary
Amarin beats GW Pharmaceuticals on 10 of the 14 factors compared between the two stocks.