Endo International (NASDAQ:ENDP) and Verona Pharma (NASDAQ:VRNA) are both small-cap medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, risk, earnings, dividends, valuation, analyst recommendations and institutional ownership.
Volatility and Risk
Endo International has a beta of 1.41, suggesting that its stock price is 41% more volatile than the S&P 500. Comparatively, Verona Pharma has a beta of 0.4, suggesting that its stock price is 60% less volatile than the S&P 500.
Profitability
This table compares Endo International and Verona Pharma's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Endo International | -5.30% | -85.80% | 7.19% |
| Verona Pharma | N/A | -115.93% | -73.68% |
Insider and Institutional Ownership
80.0% of Endo International shares are owned by institutional investors. Comparatively, 54.5% of Verona Pharma shares are owned by institutional investors. 1.5% of Endo International shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares Endo International and Verona Pharma's top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Endo International | $2.91 billion | 0.44 | $-422,640,000.00 | $2.38 | 2.33 |
| Verona Pharma | N/A | N/A | $-40,780,000.00 | ($3.10) | -1.90 |
Verona Pharma has lower revenue, but higher earnings than Endo International. Verona Pharma is trading at a lower price-to-earnings ratio than Endo International, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent recommendations and price targets for Endo International and Verona Pharma, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Endo International | 2 | 3 | 2 | 0 | 2.00 |
| Verona Pharma | 0 | 0 | 3 | 0 | 3.00 |
Endo International presently has a consensus target price of $7.6667, suggesting a potential upside of 38.39%. Verona Pharma has a consensus target price of $19.3333, suggesting a potential upside of 227.68%. Given Verona Pharma's stronger consensus rating and higher possible upside, analysts clearly believe Verona Pharma is more favorable than Endo International.
Summary
Endo International beats Verona Pharma on 7 of the 13 factors compared between the two stocks.
