Comparing Incyte (NASDAQ:INCY) and Ligand Pharmaceuticals (LGND)

Ligand Pharmaceuticals (NASDAQ: LGND) and Incyte (NASDAQ:INCY) are both medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, valuation, risk, dividends and analyst recommendations.

Profitability

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This table compares Ligand Pharmaceuticals and Incyte’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ligand Pharmaceuticals 8.90% 14.44% 8.65%
Incyte -20.38% -11.85% -8.05%

Risk & Volatility

Ligand Pharmaceuticals has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, Incyte has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Ligand Pharmaceuticals and Incyte, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ligand Pharmaceuticals 1 0 4 0 2.60
Incyte 0 5 15 0 2.75

Ligand Pharmaceuticals presently has a consensus target price of $159.00, indicating a potential downside of 3.73%. Incyte has a consensus target price of $142.37, indicating a potential upside of 70.85%. Given Incyte’s stronger consensus rating and higher possible upside, analysts plainly believe Incyte is more favorable than Ligand Pharmaceuticals.

Earnings & Valuation

This table compares Ligand Pharmaceuticals and Incyte’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ligand Pharmaceuticals $141.10 million 24.81 $12.55 million $0.51 323.85
Incyte $1.54 billion 11.49 -$313.14 million ($1.56) -53.42

Ligand Pharmaceuticals has higher earnings, but lower revenue than Incyte. Incyte is trading at a lower price-to-earnings ratio than Ligand Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

93.5% of Incyte shares are owned by institutional investors. 8.3% of Ligand Pharmaceuticals shares are owned by insiders. Comparatively, 17.2% of Incyte shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Ligand Pharmaceuticals beats Incyte on 8 of the 14 factors compared between the two stocks.

About Ligand Pharmaceuticals

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing and acquiring technologies that help pharmaceutical companies to discover and develop medicines worldwide. Its commercial programs include Promacta, an oral medicine that increases the number of platelets in the blood; Kyprolis and Evomela, which are used to treat multiple myeloma; Baxdela, a captisol-enabled delafloxacin-IV for the treatment of acute bacterial skin and skin structure infections; Nexterone, a captisol-enabled formulation of amiodarone; Noxafil-IV, a captisol-enabled formulation of posaconazole for IV use; Carnexiv, which is indicated as replacement therapy for oral carbamazepine formulations; bazedoxifene for the treatment of postmenopausal osteoporosis; commercial pericardial repair and CanGaroo envelope extracellular matrix products; Exemptia for autoimmune diseases; Vivitra for breast cancer; and Bryxta for non-small cell lung cancer. The company's partners programs, which are in clinical development used for the treatment of seizure, coma, cancer, diabetes, cardiovascular diseases, muscle wasting, liver and kidney diseases, and others. It is also developing a small molecule glucagon receptor antagonist for the treatment of Type 2 diabetes mellitus. In addition, the company is involved in the sale of Captisol materials. Ligand Pharmaceuticals Incorporated was founded in 1987 and is headquartered in San Diego, California.

About Incyte

Incyte Corporation, a biopharmaceutical company, focuses on the discovery, development, and commercialization of proprietary therapeutics in the United States. It offers JAKAFI, a drug for the treatment of myelofibrosis and polycythemia vera cancers; and ICLUSIG, a kinase inhibitor for the treatment of chronic myeloid leukemia and philadelphia-chromosome positive acute lymphoblastic leukemia. The company's clinical stage products include ruxolitinib, a drug that is in pivotal Phase II clinical trial for steroid-refractory acute graft-versus-host-diseases (GVHD); and Phase II clinical trial for the treatment of essential thrombocythemia, as well as Phase III clinical trials for steroid-refractory acute and chronic GVHDs. In addition, it is developing itacitinib that is in Phase I/II clinical trial in combination with osimertinib for non-small cell lung cancer (NSCLC), as well as Phase III clinical trial for naïve acute GVHD; epacadostat that is in Phase III clinical trails for the treatment of melanoma, renal, bladder, head and neck, non-small cell lung cancers; MGA012 that is in Phase I clinical trial for solid tumors; INCB50465, which is in Phase II clinical trials for the treatment of diffuse large b-cell lymphoma, follicular lymphoma, marginal zone lymphoma, and mantel cell lymphoma; and INCB54828 that is in Phase II clinical trials for the bladder cancer, cholangiocarcinoma, and 8p11 myeloproliferative syndrome. The company markets its JAKAFI product through a network of specialty pharmacy providers and wholesalers. It has collaboration agreements with Novartis International Pharmaceutical Ltd.; Eli Lilly and Company; Agenus Inc.; Jiangsu Hengrui Medicine Co., Ltd.; Merus N.V.; Calithera Biosciences, Inc; Pfizer; and MacroGenics, Inc. Incyte Corporation was founded in 1991 and is headquartered in Wilmington, Delaware.

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