Merck & Co., Inc. (NYSE:MRK) and Supernus Pharmaceuticals (NASDAQ:SUPN) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.
Institutional & Insider Ownership
72.9% of Merck & Co., Inc. shares are owned by institutional investors. Comparatively, 96.1% of Supernus Pharmaceuticals shares are owned by institutional investors. 0.3% of Merck & Co., Inc. shares are owned by company insiders. Comparatively, 6.6% of Supernus Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares Merck & Co., Inc. and Supernus Pharmaceuticals' revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Merck & Co., Inc. | $46.84 billion | 4.12 | $9.84 billion | $5.19 | 14.70 |
Supernus Pharmaceuticals | $392.76 million | 3.81 | $113.06 million | $2.10 | 13.48 |
Merck & Co., Inc. has higher revenue and earnings than Supernus Pharmaceuticals. Supernus Pharmaceuticals is trading at a lower price-to-earnings ratio than Merck & Co., Inc., indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Merck & Co., Inc. and Supernus Pharmaceuticals, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Merck & Co., Inc. | 0 | 2 | 12 | 0 | 2.86 |
Supernus Pharmaceuticals | 0 | 2 | 1 | 0 | 2.33 |
Merck & Co., Inc. presently has a consensus price target of $95.9167, suggesting a potential upside of 25.69%. Supernus Pharmaceuticals has a consensus price target of $27.6667, suggesting a potential downside of 2.27%. Given Merck & Co., Inc.'s stronger consensus rating and higher probable upside, equities analysts clearly believe Merck & Co., Inc. is more favorable than Supernus Pharmaceuticals.
Risk & Volatility
Merck & Co., Inc. has a beta of 0.43, meaning that its stock price is 57% less volatile than the S&P 500. Comparatively, Supernus Pharmaceuticals has a beta of 1.38, meaning that its stock price is 38% more volatile than the S&P 500.
Profitability
This table compares Merck & Co., Inc. and Supernus Pharmaceuticals' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Merck & Co., Inc. | 24.33% | 53.83% | 16.83% |
Supernus Pharmaceuticals | 27.09% | 20.02% | 9.67% |
Summary
Merck & Co., Inc. beats Supernus Pharmaceuticals on 10 of the 14 factors compared between the two stocks.