Critical Analysis: Schrodinger (NASDAQ:SDGR) & Hims & Hers Health (NYSE:HIMS)

Hims & Hers Health (NYSE:HIMS) and Schrodinger (NASDAQ:SDGR) are both medical companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Insider and Institutional Ownership

63.5% of Hims & Hers Health shares are owned by institutional investors. Comparatively, 79.1% of Schrodinger shares are owned by institutional investors. 17.7% of Hims & Hers Health shares are owned by company insiders. Comparatively, 21.0% of Schrodinger shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Hims & Hers Health and Schrodinger’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hims & Hers Health	6.05%	24.67%	9.37%
Schrodinger	-68.49%	-48.24%	-24.21%

Earnings and Valuation

This table compares Hims & Hers Health and Schrodinger”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hims & Hers Health	$1.48 billion	4.84	$126.04 million	$0.54	58.11
Schrodinger	$207.54 million	5.96	-$187.12 million	($2.41)	-6.97

Hims & Hers Health has higher revenue and earnings than Schrodinger. Schrodinger is trading at a lower price-to-earnings ratio than Hims & Hers Health, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Hims & Hers Health has a beta of 2.37, indicating that its stock price is 137% more volatile than the S&P 500. Comparatively, Schrodinger has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Hims & Hers Health and Schrodinger, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hims & Hers Health	3	11	3	1	2.11
Schrodinger	1	4	6	0	2.45

Hims & Hers Health currently has a consensus price target of $44.54, indicating a potential upside of 41.93%. Schrodinger has a consensus price target of $24.33, indicating a potential upside of 44.93%. Given Schrodinger’s stronger consensus rating and higher probable upside, analysts clearly believe Schrodinger is more favorable than Hims & Hers Health.

Summary

Hims & Hers Health beats Schrodinger on 9 of the 15 factors compared between the two stocks.

About Hims & Hers Health

Hims & Hers Health, Inc. operates a telehealth consultation platform. It connects consumers to healthcare professionals, enabling them to access medical care for mental health, sexual health, dermatology and primary care. The company was founded in 2017 and is headquartered in San Francisco, CA.

About Schrodinger

Schrödinger, Inc., together with its subsidiaries, develops physics-based computational platform that enables discovery of novel molecules for drug development and materials applications. The company operates in two segments, Software and Drug Discovery. The Software segment is focused on licensing its software to transform molecular discovery for life sciences and materials science industries. The Drug Discovery segment focuses on building a portfolio of preclinical and clinical programs, internally and through collaborations. The company serves biopharmaceutical and industrial companies, academic institutions, and government laboratories worldwide. Schrödinger, Inc. was incorporated in 1990 and is based in New York, New York.