Roche (OTCMKTS:RHHVF) & Eli Lilly and Company (NYSE:LLY) Critical Comparison

Roche (OTCMKTS:RHHVF) and Eli Lilly and Company (NYSE:LLY) are both medical companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, dividends, analyst recommendations, risk, institutional ownership, earnings and valuation.

Valuation & Earnings

This table compares Roche and Eli Lilly and Company’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Roche	N/A	N/A	N/A	$10.81	30.65
Eli Lilly and Company	$38.92 billion	23.24	$5.24 billion	$6.79	140.20

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

Dividends

Roche pays an annual dividend of $7.80 per share and has a dividend yield of 2.4%. Eli Lilly and Company pays an annual dividend of $5.20 per share and has a dividend yield of 0.5%. Roche pays out 72.2% of its earnings in the form of a dividend. Eli Lilly and Company pays out 76.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Roche is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Roche and Eli Lilly and Company’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Roche	N/A	N/A	N/A
Eli Lilly and Company	17.08%	56.98%	10.94%

Insider and Institutional Ownership

29.0% of Roche shares are held by institutional investors. Comparatively, 82.5% of Eli Lilly and Company shares are held by institutional investors. 0.1% of Eli Lilly and Company shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Roche and Eli Lilly and Company, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Roche	0	0	0	0	N/A
Eli Lilly and Company	0	2	16	0	2.89

Eli Lilly and Company has a consensus target price of $956.88, indicating a potential upside of 0.52%. Given Eli Lilly and Company’s higher probable upside, analysts plainly believe Eli Lilly and Company is more favorable than Roche.

Summary

Eli Lilly and Company beats Roche on 9 of the 12 factors compared between the two stocks.

About Roche

Roche Holding AG engages in the pharmaceuticals and diagnostics businesses in Europe, North America, Latin America, Asia, Africa, Australia, and Oceania. The company offers pharmaceutical products in the therapeutic areas of anemia, blood and solid tumors, dermatology, hemophilia, inflammatory and autoimmune, neurological disorders, ophthalmology, respiratory disorders, and transplantation. It is also developing products for various therapeutic areas. In addition, it offers in vitro tests for the diagnosis of various diseases, such as cancer, diabetes, Covid-19, hepatitis, human papillomavirus, and other diseases; diagnostic instruments; and digital health solutions. Roche Holding AG was founded in 1896 and is based in Basel, Switzerland.

About Eli Lilly and Company

Eli Lilly and Company discovers, develops, and markets human pharmaceuticals worldwide. The company offers Basaglar, Humalog, Humalog Mix 75/25, Humalog U-100, Humalog U-200, Humalog Mix 50/50, insulin lispro, insulin lispro protamine, insulin lispro mix 75/25, Humulin, Humulin 70/30, Humulin N, Humulin R, and Humulin U-500 for diabetes; Jardiance, Mounjaro, and Trulicity for type 2 diabetes; and Zepbound for obesity. It also provides oncology products, including Alimta, Cyramza, Erbitux, Jaypirca, Retevmo, Tyvyt, and Verzenio. In addition, the company offers Olumiant for rheumatoid arthritis, atopic dermatitis, severe alopecia areata, and COVID-19; Taltz for plaque psoriasis, psoriatic arthritis, ankylosing spondylitis, and non-radiographic axial spondylarthritis; Omvoh for ulcerative colitis; Cymbalta for depressive disorder, diabetic peripheral neuropathic pain, generalized anxiety disorder, fibromyalgia, and chronic musculoskeletal pain; Ebglyss for severe atopic dermatitis; and Emgality for migraine prevention and episodic cluster headache. Further, it provides Cialis for erectile dysfunction and benign prostatic hyperplasia; and Forteo for osteoporosis. It has collaborations with Incyte Corporation; Boehringer Ingelheim Pharmaceuticals, Inc.; F. Hoffmann-La Roche Ltd and Genentech, Inc.; Biologics, Inc., AbCellera Biologics Inc.; and Chugai Pharmaceutical Co., Ltd. The company was founded in 1876 and is headquartered in Indianapolis, Indiana.