Critical Review: GRAIL (NASDAQ:GRAL) and Gilead Sciences (NASDAQ:GILD)

Gilead Sciences (NASDAQ:GILD – Get Free Report) and GRAIL (NASDAQ:GRAL – Get Free Report) are both healthcare companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Profitability

This table compares Gilead Sciences and GRAIL’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gilead Sciences -10.64% -2.11% -0.75%
GRAIL -236.95% -15.88% -14.02%

Analyst Ratings

This is a summary of recent recommendations and price targets for Gilead Sciences and GRAIL, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gilead Sciences 0 6 23 0 2.79
GRAIL 1 6 5 0 2.33

Gilead Sciences presently has a consensus target price of $159.15, suggesting a potential upside of 8.37%. GRAIL has a consensus target price of $102.70, suggesting a potential downside of 22.72%. Given Gilead Sciences’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Gilead Sciences is more favorable than GRAIL.

Volatility and Risk

Gilead Sciences has a beta of 0.31, suggesting that its share price is 69% less volatile than the S&P 500. Comparatively, GRAIL has a beta of 2.83, suggesting that its share price is 183% more volatile than the S&P 500.

Valuation and Earnings

This table compares Gilead Sciences and GRAIL”s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gilead Sciences $29.44 billion 6.18 $8.51 billion ($2.67) -55.00
GRAIL $147.17 million 40.34 -$408.35 million ($9.75) -13.63

Gilead Sciences has higher revenue and earnings than GRAIL. Gilead Sciences is trading at a lower price-to-earnings ratio than GRAIL, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

83.7% of Gilead Sciences shares are held by institutional investors. 0.3% of Gilead Sciences shares are held by insiders. Comparatively, 1.8% of GRAIL shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Gilead Sciences beats GRAIL on 10 of the 14 factors compared between the two stocks.

About Gilead Sciences

(Get Free Report)

Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally. The company provides Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, Sunlencs, and Atripla products for the treatment of HIV/AIDS; Veklury, an injection for intravenous use, for the treatment of COVID-19; and Epclusa, Harvoni, Vemlidy, and Viread for the treatment of viral hepatitis. It also offers Yescarta, Tecartus, and Trodelvy products for the treatment of oncology; Letairis, an oral formulation for the treatment of pulmonary arterial hypertension; and AmBisome, a liposomal formulation for the treatment of serious invasive fungal infections. The company has collaboration agreements with Arcus Biosciences, Inc.; Merck Sharp & Dohme Corp.; Pionyr Immunotherapeutics Inc.; Tizona Therapeutics, Inc.; Galapagos NV; Janssen Sciences Ireland Unlimited Company; Japan Tobacco, Inc.; Dragonfly Therapeutics, Inc.; Arcellx, Inc.; Everest Medicines; Merck & Co, Inc.; Tentarix Biotherapeutics Inc.; and Assembly Biosciences, Inc. It also has research collaboration, option, and license agreement with Merus N.V. for the discovery of novel dual tumor-associated antigens (TAA) targeting trispecific antibodies. The company was incorporated in 1987 and is headquartered in Foster City, California.

About GRAIL

(Get Free Report)

GRAIL, Inc. operates as a commercial-stage healthcare company, which engages in the development of a technology for early detection of cancer. It utilizes machine learning, software, and automation to detect and identify multiple deadly cancer types in earlier stages. The company was founded by Jeffrey T. Huber, William H. Rastetter, Mostafa Ronaghi, and Richard D. Klausner on September 11, 2015 and is headquartered in Menlo Park, CA.

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