Financial Analysis: Johnson & Johnson (NYSE:JNJ) versus Oculis (NASDAQ:OCS)

Johnson & Johnson (NYSE:JNJ) and Oculis (NASDAQ:OCS) are both healthcare companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.

Institutional & Insider Ownership

69.6% of Johnson & Johnson shares are owned by institutional investors. Comparatively, 22.3% of Oculis shares are owned by institutional investors. 0.2% of Johnson & Johnson shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Johnson & Johnson and Oculis”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Johnson & Johnson	$94.19 billion	6.99	$26.80 billion	$6.60	41.42
Oculis	$1.45 million	330.29	-$119.44 million	($1.74)	-4.75

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

Volatility and Risk

Johnson & Johnson has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500. Comparatively, Oculis has a beta of 0.62, suggesting that its share price is 38% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Johnson & Johnson and Oculis, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Johnson & Johnson	0	8	17	1	2.73
Oculis	1	0	9	0	2.80

Johnson & Johnson presently has a consensus target price of $275.92, indicating a potential upside of 0.92%. Oculis has a consensus target price of $39.44, indicating a potential upside of 377.54%. Given Oculis’ stronger consensus rating and higher probable upside, analysts clearly believe Oculis is more favorable than Johnson & Johnson.

Profitability

This table compares Johnson & Johnson and Oculis’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Johnson & Johnson	16.20%	31.64%	13.04%
Oculis	-6,777.18%	-42.61%	-35.23%

Summary

Johnson & Johnson beats Oculis on 11 of the 15 factors compared between the two stocks.

About Johnson & Johnson

Johnson & Johnson is a holding company, which engages in the research, development, manufacture, and sale of products in the healthcare field. It operates through the Innovative Medicine and MedTech segments. The Innovative Medicine segment focuses on immunology, infectious diseases, neuroscience, oncology, cardiovascular and metabolism, and pulmonary hypertension. The MedTech segment includes a portfolio of products used in the interventional solutions, orthopaedics, surgery, and vision categories. The company was founded by Robert Wood Johnson I, James Wood Johnson, and Edward Mead Johnson Sr. in 1887 and is headquartered in New Brunswick, NJ.

About Oculis

Oculis Holding AG, a clinical-stage biopharmaceutical company, develops drug candidates to treat ophthalmic diseases. The company's lead product candidate is OCS-01, a topical dexamethasone optireach formulation, which is in Phase 3 clinical trials for the treatment of diabetic macular edema; OCS-02, a topical biologic candidate that is in Phase 2b clinical trials for the treatment for dry eye disease; and OCS-05, a disease modifying neuroprotective agent for neurological damage with indications for glaucoma, dry age-related macular degeneration and diabetic retinopathy, and acute optic neuritis. The company is based in Zug, Switzerland.