Anthem (NYSE: ANTM) and Catamaran Corp (NASDAQ:CTRX) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, profitabiliy, analyst recommendations, dividends and risk.

Insider and Institutional Ownership

89.8% of Anthem shares are owned by institutional investors. 0.4% of Anthem shares are owned by company 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.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Anthem and Catamaran Corp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anthem 0 10 8 0 2.44
Catamaran Corp 0 0 0 0 N/A

Anthem presently has a consensus target price of $179.47, suggesting a potential downside of 6.94%. Given Anthem’s higher probable upside, equities analysts clearly believe Anthem is more favorable than Catamaran Corp.

Dividends

Anthem pays an annual dividend of $2.60 per share and has a dividend yield of 1.3%. Catamaran Corp does not pay a dividend. Anthem pays out 24.6% of its earnings in the form of a dividend. Anthem has raised its dividend for 2 consecutive years.

Earnings and Valuation

This table compares Anthem and Catamaran Corp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Anthem $88.03 billion 0.58 $5.75 billion $10.56 18.26
Catamaran Corp N/A N/A N/A N/A N/A

Anthem has higher revenue and earnings than Catamaran Corp.

Profitability

This table compares Anthem and Catamaran Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Anthem 3.24% 12.93% 4.96%
Catamaran Corp 1.66% 6.54% 4.25%

Summary

Anthem beats Catamaran Corp on 10 of the 11 factors compared between the two stocks.

About Anthem

Anthem, Inc. is a health benefits company. The Company operates through three segments: Commercial and Specialty Business, Government Business and Other. It offers a spectrum of network-based managed care plans to large and small employer, individual, Medicaid and Medicare markets. Its managed care plans include preferred provider organizations; health maintenance organizations; point-of-service plans; indemnity plans and other hybrid plans, including consumer-driven health plans; and hospital only and limited benefit products. It also provides an array of managed care services to self-funded customers, including claims processing, underwriting, stop loss insurance, actuarial services, provider network access, medical cost management, disease management, wellness programs and other administrative services. It provides an array of specialty and other insurance products and services, such as dental, vision, life and disability insurance benefits and radiology benefit management.

About Catamaran Corp

Catamaran Corporation (Catamaran) is a provider of pharmacy benefit management (PBM) services and healthcare information technology (HCIT) solutions to the healthcare benefit management industry. The Company operates in two segments: PBM and HCIT. The Company offers PBM services, which are marketed under the Catamaran PBM brand, and is engaged in owning and operating a network of mail and specialty pharmacies. In addition, the Company is a national provider of drug benefits to its customers under the federal government’s Medicare Part D program. The Company’s HCIT product offerings include a range of software products for managing prescription drug programs and for drug prescribing and dispensing. The Company’s customers include organizations in the pharmaceutical supply chain, such as pharmacy benefit managers, managed care organizations, self-insured employer groups, unions, third-party healthcare plan administrators, and state and federal government entities.

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