United-Guardian (NASDAQ:UG – Get Free Report) and Royalty Pharma (NASDAQ:RPRX – Get Free Report) are both healthcare companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, analyst recommendations, earnings and profitability.
Analyst Ratings
This is a summary of recent ratings for United-Guardian and Royalty Pharma, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| United-Guardian | 0 | 1 | 0 | 0 | 2.00 |
| Royalty Pharma | 0 | 0 | 8 | 0 | 3.00 |
Royalty Pharma has a consensus target price of $61.57, suggesting a potential upside of 6.56%. Given Royalty Pharma’s stronger consensus rating and higher possible upside, analysts plainly believe Royalty Pharma is more favorable than United-Guardian.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| United-Guardian | $10.55 million | 3.00 | $2.11 million | $0.54 | 12.78 |
| Royalty Pharma | $2.38 billion | 13.97 | $770.95 million | $1.45 | 39.85 |
Royalty Pharma has higher revenue and earnings than United-Guardian. United-Guardian is trading at a lower price-to-earnings ratio than Royalty Pharma, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares United-Guardian and Royalty Pharma’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| United-Guardian | 22.01% | 22.24% | 19.12% |
| Royalty Pharma | 32.14% | 30.01% | 14.91% |
Risk and Volatility
United-Guardian has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500. Comparatively, Royalty Pharma has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500.
Dividends
United-Guardian pays an annual dividend of $0.60 per share and has a dividend yield of 8.7%. Royalty Pharma pays an annual dividend of $0.94 per share and has a dividend yield of 1.6%. United-Guardian pays out 111.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Royalty Pharma pays out 64.8% of its earnings in the form of a dividend. United-Guardian has raised its dividend for 1 consecutive years and Royalty Pharma has raised its dividend for 5 consecutive years.
Institutional and Insider Ownership
23.2% of United-Guardian shares are owned by institutional investors. Comparatively, 54.3% of Royalty Pharma shares are owned by institutional investors. 29.0% of United-Guardian shares are owned by company insiders. Comparatively, 18.8% of Royalty Pharma shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Summary
Royalty Pharma beats United-Guardian on 13 of the 17 factors compared between the two stocks.
About United-Guardian
United-Guardian, Inc. manufactures and markets cosmetic ingredients, pharmaceuticals, medical lubricants, and proprietary specialty industrial products in the United States and internationally The company offers cosmetic ingredients, including LUBRAJEL, a line of water-based gel formulation for sensory enhancement, lubrication, and texture to personal care products; LUBRAJEL NATURAL for skin moisturizing; LUBRAJEL MARINE that develops natural products using naturally derived polymers; LUBRAJEL OlL NATURAL, which makes luxuriant textures without adding viscosity; LUBRAJEL TERRA, a multifunctional, moisturizing hydrogel products; LUBRASIL II SB, a formulation of LUBRAJEL; LUBRAJEL II XD; B-122, a powdered lubricant used in the manufacture of pressed powders, eyeliners, rouges, and industrial products; and ORCHID COMPLEX, an oil-soluble base for extract of fresh orchids used in fragrance products, such as perfumes and toiletries. Its medical lubricants comprise LUBRAJEL RR and RC, which are water-based lubricant gels for urinary catheters; LUBRAJEL MG to lubricate urinary catheters, pre-lubricated enema tips, and other medical devices; LUBRAJEL MGL, a medical lubricant with a lower viscosity medical lubricant; LUBRAJEL LC, LUBRAJEL BA, and LUBRAJEL FA, which are formulations for oral care; and LUBRAJEL FLUID to lubricate water-soluble products. The company's pharmaceutical products consist of RENACIDIN, a prescription drug to prevent and dissolve calcifications in urethral catheters and the urinary bladder; and CLORPACTIN WCS-90, an antimicrobial used in urology. Its industrial products include DESELEX, a sequestering and chelating agent used for manufacturing detergents; and THOROCLENS, a chlorine-based industrial cleanser. The company also conducts research and product development of cosmetic ingredients. The company was founded in 1942 and is based in Hauppauge, New York.
About Royalty Pharma
Royalty Pharma plc operates as a buyer of biopharmaceutical royalties and a funder of innovations in the biopharmaceutical industry in the United States. It is also involved in the identification, evaluation, and acquisition of royalties on various biopharmaceutical therapies. In addition, the company collaborates with innovators from academic institutions, research hospitals and not-for-profits, small and mid-cap biotechnology companies, and pharmaceutical companies. Its portfolio consists of royalties on approximately 35 commercial products and 14 development-stage product candidates that address various therapeutic areas, such as rare disease, cancer, neuroscience, immunology, respiratory, infectious disease, hematology, and diabetes. The company was founded in 1996 and is based in New York, New York.
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