Aceto (ACET) & Celsius (CELH) Critical Contrast

Aceto (NASDAQ: ACET) and Celsius (NASDAQ:CELH) are both small-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Volatility and Risk

Aceto has a beta of 1.38, indicating that its stock price is 38% more volatile than the S&P 500. Comparatively, Celsius has a beta of -0.81, indicating that its stock price is 181% less volatile than the S&P 500.

Dividends

Aceto pays an annual dividend of $0.26 per share and has a dividend yield of 2.4%. Celsius does not pay a dividend. Aceto pays out 123.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a summary of recent ratings and target prices for Aceto and Celsius, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aceto 0 2 1 0 2.33
Celsius 0 0 1 0 3.00

Aceto presently has a consensus price target of $15.00, indicating a potential upside of 40.19%. Celsius has a consensus price target of $7.00, indicating a potential upside of 39.44%. Given Aceto’s higher probable upside, analysts clearly believe Aceto is more favorable than Celsius.

Valuation & Earnings

This table compares Aceto and Celsius’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aceto $638.32 million 0.50 $11.37 million $0.21 50.95
Celsius $22.76 million 10.08 -$3.06 million ($0.09) -55.78

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

Profitability

This table compares Aceto and Celsius’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aceto 1.07% 10.18% 3.95%
Celsius -10.37% -18.23% -12.52%

Institutional and Insider Ownership

80.8% of Aceto shares are held by institutional investors. Comparatively, 6.2% of Celsius shares are held by institutional investors. 4.1% of Aceto shares are held by company insiders. Comparatively, 49.0% of Celsius shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Aceto beats Celsius on 11 of the 15 factors compared between the two stocks.

Aceto Company Profile

Aceto Corporation (Aceto) is engaged in the marketing, sales and distribution of finished dosage form generic pharmaceuticals, nutraceutical products, pharmaceutical active ingredients and intermediates, specialty performance chemicals inclusive of agricultural intermediates and agricultural protection products. The Company’s business is organized along product lines into three segments: Human Health, Pharmaceutical Ingredients and Performance Chemicals. As of June 30, 2016, it distributed over 1,100 chemical compounds used primarily as finished products or raw materials in the agricultural, coatings and industrial chemical industries. The Human Health segment includes finished dosage form generic drugs and nutraceutical products. As of June 30, 2016, the Pharmaceutical Ingredients segment had two product groups: Active Pharmaceutical Ingredients and Pharmaceutical Intermediates. The Performance Chemicals segment includes specialty chemicals and agricultural protection products.

Celsius Company Profile

Celsius Holdings, Inc. is engaged in the development, marketing, sale and distribution of functional calorie-burning fitness beverages under the Celsius brand name. The Company’s product range includes Sparkling Grape Rush, Sparkling Watermelon, Sparkling Orange, Sparkling Wild Berry, Sparkling Cola, Raspberry Acai Green Tea, Peach Mango Green Tea, Flo Fusion Orange and Flo Fusion Berry. The Company’s products are sweetened with sucralose, which is suitable for consumers whose sugar intake is restricted. The Company’s Celsius brand uses ingredients and supplements, such as green tea (EGCG), ginger, calcium, chromium, B vitamins and vitamin C. The Company outsources the manufacturing process to third-party co-packers. It provides co-packers with flavors, ingredient blends, cans and other raw materials for its beverages purchased by it from various suppliers. It sells Celsius brand across retail segments, which include supermarkets and convenience stores.

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