Aralez Pharmaceuticals (NASDAQ: ARLZ) and Eli Lilly and (NYSE:LLY) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitabiliy, analyst recommendations, earnings, institutional ownership and dividends.

Valuation and Earnings

This table compares Aralez Pharmaceuticals and Eli Lilly and’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Aralez Pharmaceuticals $72.18 million 1.02 -$60.55 million ($1.49) -0.75
Eli Lilly and $22.00 billion 3.96 $5.99 billion $2.31 35.74

Eli Lilly and has higher revenue and earnings than Aralez Pharmaceuticals. Aralez Pharmaceuticals is trading at a lower price-to-earnings ratio than Eli Lilly and, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Aralez Pharmaceuticals and Eli Lilly and, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aralez Pharmaceuticals 0 0 3 0 3.00
Eli Lilly and 1 6 11 0 2.56

Aralez Pharmaceuticals currently has a consensus price target of $8.00, suggesting a potential upside of 614.29%. Eli Lilly and has a consensus price target of $89.18, suggesting a potential upside of 8.00%. Given Aralez Pharmaceuticals’ stronger consensus rating and higher probable upside, research analysts clearly believe Aralez Pharmaceuticals is more favorable than Eli Lilly and.

Institutional & Insider Ownership

35.6% of Aralez Pharmaceuticals shares are held by institutional investors. Comparatively, 75.6% of Eli Lilly and shares are held by institutional investors. 6.7% of Aralez Pharmaceuticals shares are held by company insiders. Comparatively, 0.2% of Eli Lilly and shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Aralez Pharmaceuticals and Eli Lilly and’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aralez Pharmaceuticals -133.92% -66.74% -22.58%
Eli Lilly and 11.12% 28.71% 10.74%

Dividends

Eli Lilly and pays an annual dividend of $2.08 per share and has a dividend yield of 2.5%. Aralez Pharmaceuticals does not pay a dividend. Eli Lilly and pays out 90.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eli Lilly and has increased its dividend for 2 consecutive years.

Risk & Volatility

Aralez Pharmaceuticals has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, Eli Lilly and has a beta of 0.34, suggesting that its share price is 66% less volatile than the S&P 500.

Summary

Eli Lilly and beats Aralez Pharmaceuticals on 11 of the 16 factors compared between the two stocks.

Aralez Pharmaceuticals Company Profile

Aralez Pharmaceuticals Inc. is a Canada-based specialty pharmaceutical company. The Company focuses on acquiring, developing and commercializing products in cardiovascular, pain and other areas. The Company’s products include Fibricor, Cambia, Fiorinal, Fiorinal C, Soriatane, Bezalip SR, NeoVisc, Uracyst, Durela, Proferrin, Resultz and Collatamp G. Its development products include YOSPRALA and Bilastine. Fibricor (fenofibric acid) is indicated as a complementary therapy along with diet for the treatment of hypertriglyceridemia, and as a complementary therapy along with diet to reduce elevated low-density lipoprotein cholesterol (LDL-C), total cholesterol (Total-C), triglycerides (TG) and apolipoprotein B (Apo B). Fibricor is also used to increase high-density lipoprotein (HDL) cholesterol (HDL-C) in patients with hypercholesterolemia or mixed dyslipidemia. Cambia (diclofenac potassium for oral solution) is a non-steroidal anti-inflammatory drug (NSAID).

Eli Lilly and Company Profile

Eli Lilly and Company is engaged in drug manufacturing business. The Company discovers, develops, manufactures and markets products in two segments: human pharmaceutical products and animal health products. The Company’s human pharmaceutical business segment sells medicines, which are discovered or developed by its scientists. Its animal health business segment operates through the Company’s Elanco division, which develops, manufactures and markets products for both food animals and companion animals. The Company’s human pharmaceutical products include endocrinology products, neuroscience products, oncology products, immunology products and cardiovascular products. The Company’s animal health products segment includes products for food animals and products for companion animals. As of December 31, 2016, the Company manufactured and distributed its products through facilities in the United States, Puerto Rico and 14 other countries.

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