Reviewing McKesson (NYSE:MCK) & Spotlight Innovation (OTCMKTS:STLT)

McKesson (NYSE:MCK) and Spotlight Innovation (OTCMKTS:STLT) are both medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, profitability, earnings, dividends and valuation.

Valuation and Earnings

This table compares McKesson and Spotlight Innovation”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
McKesson	$359.05 billion	0.24	$3.30 billion	$25.08	28.15
Spotlight Innovation	N/A	N/A	N/A	N/A	N/A

McKesson has higher revenue and earnings than Spotlight Innovation.

Profitability

This table compares McKesson and Spotlight Innovation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
McKesson	0.84%	-196.66%	5.66%
Spotlight Innovation	N/A	N/A	N/A

Insider and Institutional Ownership

85.1% of McKesson shares are owned by institutional investors. 0.1% of McKesson shares are owned by 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.

Analyst Ratings

This is a breakdown of recent ratings and price targets for McKesson and Spotlight Innovation, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
McKesson	0	3	9	1	2.85
Spotlight Innovation	0	0	0	0	0.00

McKesson currently has a consensus target price of $725.10, indicating a potential upside of 2.72%. Given McKesson’s stronger consensus rating and higher possible upside, analysts clearly believe McKesson is more favorable than Spotlight Innovation.

Summary

McKesson beats Spotlight Innovation on 9 of the 10 factors compared between the two stocks.

About McKesson

McKesson Corporation provides healthcare services in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International. The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter pharmaceutical drugs, and other healthcare-related products. This segment also offers practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices; and consulting, outsourcing, technological, and other services, as well as sells financial, operational, and clinical solutions to pharmacies. The RxTS segment serves biopharma and life sciences partners, and patients to address medication challenges for patients by working across healthcare; connects patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to deliver innovative solutions to help people get the medicine needed to live healthier lives; and provides prescription price transparency, benefit insight, dispensing support, third-party logistics, and wholesale distribution support services. The Medical-Surgical Solutions segment offers medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. The International segment provides distribution and services to wholesale, institutional, and retail customers in Europe and Canada. McKesson Corporation was founded in 1833 and is headquartered in Irving, Texas.

About Spotlight Innovation

Spotlight Innovation Inc., a pharmaceutical company, acquires and develops proprietary therapies to address unmet medical needs with an emphasis on rare, emerging, and neglected diseases. It identifies in-licensing opportunities and manages product development through partnerships with universities, medical schools, contract research organizations, and contract manufacturing organizations, as well as pursues product commercialization opportunities, including out-licensing and strategic partnerships. The company is developing Crotoxin, which is in Phase I clinical study for the treatment of cancer. It also develops various compounds for the treatment of viral infections, including Zika virus infection; and products derived from cobra venom to treat chronic pain. Spotlight Innovation Inc. has a license agreement with Indiana University Research and Technology Corporation to commercialize STL-182, an orally-available small molecule that might have therapeutic potential for treating spinal muscular atrophy. The company is based in Urbandale, Iowa.