Ocular Therapeutix (NASDAQ: OCUL) and West Pharmaceutical Services (NYSE:WST) are both healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.
This table compares Ocular Therapeutix and West Pharmaceutical Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|West Pharmaceutical Services||12.12%||14.47%||9.71%|
52.9% of Ocular Therapeutix shares are held by institutional investors. Comparatively, 93.3% of West Pharmaceutical Services shares are held by institutional investors. 26.1% of Ocular Therapeutix shares are held by company insiders. Comparatively, 1.9% of West Pharmaceutical Services shares are held by company 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.
Risk and Volatility
Ocular Therapeutix has a beta of 1.31, suggesting that its share price is 31% more volatile than the S&P 500. Comparatively, West Pharmaceutical Services has a beta of 1.11, suggesting that its share price is 11% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Ocular Therapeutix and West Pharmaceutical Services, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|West Pharmaceutical Services||0||2||2||0||2.50|
Ocular Therapeutix currently has a consensus target price of $20.67, suggesting a potential upside of 361.31%. West Pharmaceutical Services has a consensus target price of $106.00, suggesting a potential upside of 6.65%. Given Ocular Therapeutix’s stronger consensus rating and higher possible upside, equities analysts plainly believe Ocular Therapeutix is more favorable than West Pharmaceutical Services.
Valuation & Earnings
This table compares Ocular Therapeutix and West Pharmaceutical Services’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ocular Therapeutix||$1.89 million||69.78||-$44.70 million||($2.27)||-1.97|
|West Pharmaceutical Services||$1.51 billion||4.89||$143.60 million||$2.51||39.60|
West Pharmaceutical Services has higher revenue and earnings than Ocular Therapeutix. Ocular Therapeutix is trading at a lower price-to-earnings ratio than West Pharmaceutical Services, indicating that it is currently the more affordable of the two stocks.
West Pharmaceutical Services pays an annual dividend of $0.56 per share and has a dividend yield of 0.6%. Ocular Therapeutix does not pay a dividend. West Pharmaceutical Services pays out 22.3% of its earnings in the form of a dividend. Ocular Therapeutix has raised its dividend for 24 consecutive years.
West Pharmaceutical Services beats Ocular Therapeutix on 9 of the 17 factors compared between the two stocks.
Ocular Therapeutix Company Profile
Ocular Therapeutix, Inc. is a biopharmaceutical company focused on the development, manufacturing and commercialization of therapies for diseases and conditions of the eye using its proprietary hydrogel platform technology. Its lead product candidate, DEXTENZA (dexamethasone insert) for intracanalicular use, has completed Phase III clinical development for the treatment of ocular pain and inflammation following ophthalmic surgery. OTX-TP (travoprost insert) is in Phase III clinical development for glaucoma and ocular hypertension. Its earlier stage assets include OTX-TIC, a sustained release travoprost intracameral injection for the treatment of moderate to severe glaucoma and ocular hypertension, as well as sustained release intravitreal injections for the treatment of retinal diseases. These injections include the development of OTX-TKI, a tyrosine kinase inhibitor, and, in collaboration with Regeneron an extended release protein-based anti-vascular endothelial growth factor trap.
West Pharmaceutical Services Company Profile
West Pharmaceutical Services, Inc. is a manufacturer of packaging components and delivery systems for injectable drugs and healthcare products. The Company’s products include vial containment solutions, prefillable systems, self-injection platforms, cartridge systems and components, reconstitution and transfer systems, intradermal delivery solutions, specialty components, and contract manufacturing and analytical services. The Company’s segments include Proprietary Products and Contract-Manufactured Products. The Proprietary Products segment develops commercial and operational strategies across its global network, with specific emphasis on product offerings to biologic, generic and pharmaceutical drug customers. The Contract-Manufactured Products segment serves as an integrated business focused on the design, manufacture and automated assembly of various devices, primarily for pharmaceutical, diagnostic and medical device customers.
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