Celgene (NASDAQ: CELG) and Aceto (NASDAQ:ACET) are both healthcare companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.
Insider and Institutional Ownership
79.5% of Celgene shares are owned by institutional investors. Comparatively, 80.8% of Aceto shares are owned by institutional investors. 1.0% of Celgene shares are owned by company insiders. Comparatively, 4.1% of Aceto shares are owned 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.
This table compares Celgene and Aceto’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Celgene||$11.23 billion||7.33||$2.00 billion||$4.24||24.66|
|Aceto||$638.32 million||0.53||$11.37 million||$0.21||53.15|
Celgene has higher revenue and earnings than Aceto. Celgene is trading at a lower price-to-earnings ratio than Aceto, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Celgene and Aceto, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Celgene currently has a consensus price target of $130.03, indicating a potential upside of 24.37%. Aceto has a consensus price target of $15.00, indicating a potential upside of 34.41%. Given Aceto’s higher possible upside, analysts plainly believe Aceto is more favorable than Celgene.
Risk and Volatility
Celgene has a beta of 1.77, suggesting that its stock price is 77% more volatile than the S&P 500. Comparatively, Aceto has a beta of 1.38, suggesting that its stock price is 38% more volatile than the S&P 500.
Aceto pays an annual dividend of $0.26 per share and has a dividend yield of 2.3%. Celgene 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.
This table compares Celgene and Aceto’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Celgene beats Aceto on 12 of the 17 factors compared between the two stocks.
Celgene Company Profile
Celgene Corporation is an integrated global biopharmaceutical company. The Company, together with its subsidiaries, is engaged in the discovery, development and commercialization of therapies for the treatment of cancer and inflammatory diseases through solutions in protein homeostasis, immuno-oncology, epigenetics, immunology and neuro-inflammation. Its commercial-stage products include REVLIMID (lenalidomide), POMALYST/IMNOVID (pomalidomide), OTEZLA (apremilast), ABRAXANE (paclitaxel albumin-bound particles for injectable suspension), VIDAZA, azacitidine for injection (generic version of VIDAZA) and THALOMID (thalidomide). Its clinical trial activity includes trials across the disease areas of hematology, solid tumors, and inflammation and immunology. The Company also markets ISTODAX, which is an epigenetic modifier. The Company is also evaluating AG-221 (enasidenib) in combination with VIDAZA in newly diagnosed acute myeloid leukemia with isocitrate dehydrogenase-2 mutations.
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.
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