Head to Head Analysis: Eli Lilly and (LLY) and AMAG Pharmaceuticals (AMAG)

Eli Lilly and (NYSE: LLY) and AMAG Pharmaceuticals (NASDAQ:AMAG) are both medical companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Dividends

Eli Lilly and pays an annual dividend of $2.08 per share and has a dividend yield of 2.4%. AMAG Pharmaceuticals does not pay a dividend. Eli Lilly and pays out 98.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AMAG Pharmaceuticals has increased its dividend for 2 consecutive years.

Profitability

This table compares Eli Lilly and and AMAG Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Eli Lilly and 9.90% 30.27% 10.82%
AMAG Pharmaceuticals -35.35% -0.64% -0.25%

Volatility & Risk

Eli Lilly and has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500. Comparatively, AMAG Pharmaceuticals has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Eli Lilly and and AMAG Pharmaceuticals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eli Lilly and 1 5 9 0 2.53
AMAG Pharmaceuticals 1 11 3 0 2.13

Eli Lilly and presently has a consensus price target of $91.60, suggesting a potential upside of 5.96%. AMAG Pharmaceuticals has a consensus price target of $23.58, suggesting a potential upside of 63.77%. Given AMAG Pharmaceuticals’ higher possible upside, analysts plainly believe AMAG Pharmaceuticals is more favorable than Eli Lilly and.

Earnings and Valuation

This table compares Eli Lilly and and AMAG Pharmaceuticals’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Eli Lilly and $21.22 billion 4.49 $2.74 billion $2.11 40.97
AMAG Pharmaceuticals $532.09 million 0.96 -$2.48 million ($6.08) -2.37

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

Insider and Institutional Ownership

76.4% of Eli Lilly and shares are held by institutional investors. 0.2% of Eli Lilly and shares are held by insiders. Comparatively, 3.8% of AMAG Pharmaceuticals shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Eli Lilly and beats AMAG Pharmaceuticals on 11 of the 16 factors compared between the two stocks.

About Eli Lilly and

Eli Lilly and Company is engaged in drug manufacturing business. The Company discovers, develops, manufactures and markets products in two segments: human pharmaceutical products and animal health products. The Company’s human pharmaceutical business segment sells medicines, which are discovered or developed by its scientists. Its animal health business segment operates through the Company’s Elanco division, which develops, manufactures and markets products for both food animals and companion animals. The Company’s human pharmaceutical products include endocrinology products, neuroscience products, oncology products, immunology products and cardiovascular products. The Company’s animal health products segment includes products for food animals and products for companion animals. As of December 31, 2016, the Company manufactured and distributed its products through facilities in the United States, Puerto Rico and 14 other countries.

About AMAG Pharmaceuticals

AMAG Pharmaceuticals, Inc. is a pharmaceutical company. The Company’s segment is the manufacture, development and commercialization of products and services for use in treating various conditions, with a focus on maternal health, anemia management and cancer supportive care. Its offerings focus on maternal health, anemia management and cancer supportive care, including its product, Makena (hydroxyprogesterone caproate injection); services related to the collection, processing and storage of umbilical cord blood stem cell and cord tissue units operated through Cord Blood Registry (CBR); its product, Feraheme (ferumoxytol), for intravenous (IV) use, and MuGard Mucoadhesive Oral Wound Rinse. It is engaged in the development of Digoxin immune fab, a polyclonal antibody for the treatment of severe preeclampsia in pregnant women. Makena is a drug indicated to reduce the risk of preterm birth in women pregnant with a single baby having a history of singleton spontaneous preterm birth.

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