Analyzing Gilead Sciences (NASDAQ:GILD) and Grifols (NASDAQ:GRFS)

Gilead Sciences (NASDAQ:GILD) and Grifols (NASDAQ:GRFS) are both healthcare companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, valuation and risk.

Profitability

This table compares Gilead Sciences and Grifols’ 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%
Grifols	5.54%	6.21%	2.39%

Analyst Recommendations

This is a summary of recent recommendations for Gilead Sciences and Grifols, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gilead Sciences	0	5	23	1	2.86
Grifols	1	2	0	0	1.67

Gilead Sciences currently has a consensus price target of $158.04, suggesting a potential upside of 7.58%. Grifols has a consensus price target of $10.00, suggesting a potential upside of 28.29%. Given Grifols’ higher probable upside, analysts clearly believe Grifols is more favorable than Gilead Sciences.

Dividends

Gilead Sciences pays an annual dividend of $3.28 per share and has a dividend yield of 2.2%. Grifols pays an annual dividend of $0.09 per share and has a dividend yield of 1.2%. Gilead Sciences pays out -122.8% of its earnings in the form of a dividend. Grifols pays out 47.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Gilead Sciences has raised its dividend for 10 consecutive years. Gilead Sciences is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Gilead Sciences and Grifols”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gilead Sciences	$29.44 billion	6.19	$8.51 billion	($2.67)	-55.02
Grifols	$8.51 billion	0.62	$454.82 million	$0.19	41.03

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

Risk & Volatility

Gilead Sciences has a beta of 0.33, meaning that its stock price is 67% less volatile than the S&P 500. Comparatively, Grifols has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Insider & Institutional Ownership

83.7% of Gilead Sciences shares are owned by institutional investors. 0.3% of Gilead Sciences shares are owned by insiders. Comparatively, 0.2% of Grifols 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.

Summary

Gilead Sciences beats Grifols on 11 of the 18 factors compared between the two stocks.

About Gilead Sciences

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 Grifols

Grifols, S.A. operates as a plasma therapeutic company in Spain, the United States, Canada, and internationally. The company provides immunoglobulin to treat immunodeficiencies; albumin used to restore circulatory volume and protein loss in pathophysiological conditions, such as liver cirrhosis, cardiocirculatory failure, trauma and severe burns; alpha-1 proteinase inhibitor, a plasma protein, used to treat a genetic disease known as alpha-1; factorVIII/von Willerbrand factor and factor IX, clotting factors for the treatment of hemophilia A and von Willebrand’s disease, as well as hemophilia B; antithrombin III to treat hereditary antithrombin deficiency; Fostamatinib, a spleen tyrosine kinase inhibitor; combination of fibrinogen and enzyme thrombin that acts as a biological sealant to control surgical bleeding; and plasma exchange with albumin used to treat Alzheimer’s disease. It markets diagnostic testing equipment, reagents, and other equipment; biological products; manufactures and sells plasma to third parties; and involves in research activities, as well as markets pharmaceutical products for hospital pharmacies. In addition, the company offers Yimmugo PID, an immunology drug; and Yimmugo ITP, a hematology drug. Further, it develops Xembify Pre-filled syringes, FlexBag, and Prolastin vials; Xembify Biweekly dosing, Prolastin-C, Fostamatinib2, and VISTASEAL which are in Phase IV development stage; Xembify, Albumin 20% and 5%, Fibrinogen, Trimodulin, Cytotec pregnancy, and AMBAR-Next in Phase III development stage; and AKST4290 that is in Phase II clinical development. Additionally, it offers recIG, Alpha-1 AT in non-cystic fibrosis bronchiectasis, ATIII, GIGA 2339, GIGA564, and OSIG. It has collaboration agreements with Canadian Blood Services for the processing of other plasma-derived products and with GIANT; and GigaGen to develop recombinant polyclonal immunoglobulin therapies. The company was founded in 1909 and is headquartered in Barcelona, Spain.