Financial Review: Merck KGaA (OTCMKTS:MKKGY) versus Ono Pharmaceutical (OTCMKTS:OPHLF)

Ono Pharmaceutical (OTCMKTS:OPHLF) and Merck KGaA (OTCMKTS:MKKGY) are both healthcare companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Ono Pharmaceutical and Merck KGaA, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ono Pharmaceutical	0	1	0	0	2.00
Merck KGaA	1	5	0	0	1.83

Insider & Institutional Ownership

0.1% of Merck KGaA shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Ono Pharmaceutical has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500. Comparatively, Merck KGaA has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Profitability

This table compares Ono Pharmaceutical and Merck KGaA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ono Pharmaceutical	15.02%	9.77%	7.63%
Merck KGaA	11.20%	8.10%	4.58%

Earnings and Valuation

This table compares Ono Pharmaceutical and Merck KGaA”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ono Pharmaceutical	$3.43 billion	2.08	$436.04 million	$1.05	14.44
Merck KGaA	$23.87 billion	0.89	$2.95 billion	$1.94	16.98

Merck KGaA has higher revenue and earnings than Ono Pharmaceutical. Ono Pharmaceutical is trading at a lower price-to-earnings ratio than Merck KGaA, indicating that it is currently the more affordable of the two stocks.

Summary

Merck KGaA beats Ono Pharmaceutical on 6 of the 11 factors compared between the two stocks.

About Ono Pharmaceutical

Ono Pharmaceutical Co., Ltd., together with its subsidiaries, produces, purchases, and sells pharmaceuticals and diagnostic reagents worldwide. It offers Opdivo Intravenous Infusion and Kyprolis Intravenous Injection for malignant tumors; Emend capsules/Proemend intravenous injections for chemotherapy-induced nausea and vomiting; Demser capsules for the symptoms in patients with pheochromocytoma; and Mektovi, Velexbru, and Braftovi capsules for malignant tumors, as well as ADLUMIZ tablets for cancer cachexia. The company also provides Glactiv tablets for type 2 diabetes; Forxiga tablets for diabetes; Onoact Intravenous Infusion for tachyarrhythmia; Opalmon tablets to treat peripheral circulatory disorder; Coralan for chronic heart failure; Orencia injections for rheumatoid arthritis; Rivastach patches for Alzheimer's disease; Ongentys tablets for Parkinson's disease; Parsabiv, an intravenous infusion for dialysis patients; Staybla tablets for overactive bladder; Onon capsules and Dry Syrups for bronchial asthma and allergic rhinitis; and JOYCLU intra-articular injection for the improvement of joint function, as well as Recalbon tablets for osteoporosis. In addition, it develops products for hepatocellular and urothelial carcinoma; ovarian, bladder, prostate, pancreatic, gastric, esophageal, colorectal, thyroid, cell lung, and breast cancer; acute myeloid leukemia; solid tumors; myelodysplastic syndrome; melanoma; T-cell lymphoma; tachyarrhythmia; pemphigus; scleroderma; seizures; diabetic polyneuropathy; neurodegenerative diseases; autoimmune diseases; narcolepsy; and thrombosis. The company has a collaboration with Adimab, LLC to discover novel antibody drugs; a research collaboration with Turbine Ltd. to identify and validate novel oncology targets; Harvard University for validating novel therapeutic targets; and a strategic drug discovery collaboration with Sibylla Biotech in central nervous system disorders. The company was founded in 1717 and is headquartered in Osaka, Japan.

About Merck KGaA

Merck KGaA operates as a science and technology company in Germany. It operates through Life Science, Healthcare, and Electronics segments. The company’s Life Science segment offers tools, chemicals, and equipment for academic labs, biotech, and pharmaceutical manufacturers, as well as industrial sector. This segment provides drug manufacturers with process development expertise and technologies, such as continuous bioprocessing; testing kits and services; reagents and services; testing solutions that analyze air, water, and soil; and testing and tools, as well as products that help test nutritional value and identify quality inconsistencies. Its Healthcare segment discovers, develops, manufacturers, and markets prescription drugs and biopharmaceuticals for the treatment of oncology, neurology and immunology, fertility, endocrinology, as well as cardiovascular, diabetes, thyroid disorders, and multiple sclerosis; general medicines; and injection device and disease monitoring software. The Electronics segment supplies materials for the semiconductor and display industries and surface design, such as delivery systems and services, as well as surface solutions, including cosmetics, effect pigments, and functional solutions. In addition, it has in-licensing agreement with Debiopharm International SA for developing and commercializing drug candidates for the treatment of head and neck cancer; Jiangsu Hengrui Pharmaceuticals Co. Ltd. for developing, manufacturing, and commercializing drug candidates for the treatment of metastatic colorectal cancer; and Abbisko Therapeutics Co. Ltd. for developing and commercializing of drug candidates for the treatment of tenosynovial giant cell tumor, as well as license and collaboration agreement with Merck KGaA to discover two targeted protein degraders against critical oncogenic proteins. The company was founded in 1668 and is headquartered in Darmstadt, Germany. Merck KGaA operates as a subsidiary of E. Merck KGaA.