Pfizer (NYSE:PFE – Get Free Report) and Eli Lilly and Company (NYSE:LLY – Get Free Report) are both large-cap medical companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.
Institutional & Insider Ownership
68.4% of Pfizer shares are owned by institutional investors. Comparatively, 82.5% of Eli Lilly and Company shares are owned by institutional investors. 0.1% of Pfizer shares are owned by company insiders. Comparatively, 0.1% of Eli Lilly and Company shares are owned 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 breakdown of recent ratings and target prices for Pfizer and Eli Lilly and Company, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pfizer | 1 | 13 | 5 | 3 | 2.45 |
| Eli Lilly and Company | 1 | 3 | 16 | 0 | 2.75 |
Dividends
Pfizer pays an annual dividend of $1.72 per share and has a dividend yield of 7.1%. Eli Lilly and Company pays an annual dividend of $6.00 per share and has a dividend yield of 0.7%. Pfizer pays out 124.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eli Lilly and Company pays out 48.8% of its earnings in the form of a dividend. Pfizer has raised its dividend for 16 consecutive years and Eli Lilly and Company has raised its dividend for 11 consecutive years. Pfizer is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
This table compares Pfizer and Eli Lilly and Company”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pfizer | $63.63 billion | 2.17 | $8.03 billion | $1.38 | 17.63 |
| Eli Lilly and Company | $45.04 billion | 17.00 | $10.59 billion | $12.29 | 65.73 |
Eli Lilly and Company has lower revenue, but higher earnings than Pfizer. Pfizer 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.
Volatility & Risk
Pfizer has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Eli Lilly and Company has a beta of 0.4, suggesting that its stock price is 60% less volatile than the S&P 500.
Profitability
This table compares Pfizer and Eli Lilly and Company’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Pfizer | 12.62% | 20.33% | 8.53% |
| Eli Lilly and Company | 22.67% | 85.51% | 15.74% |
Summary
Eli Lilly and Company beats Pfizer on 13 of the 18 factors compared between the two stocks.
About Pfizer
Pfizer Inc. discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products in the United States, Europe, and internationally. The company offers medicines and vaccines in various therapeutic areas, including cardiovascular metabolic, migraine, and women's health under the Eliquis, Nurtec ODT/Vydura, Zavzpret, and the Premarin family brands; infectious diseases with unmet medical needs under the Prevnar family, Abrysvo, Nimenrix, FSME/IMMUN-TicoVac, and Trumenba brands; and COVID-19 prevention and treatment, and potential future mRNA and antiviral products under the Comirnaty and Paxlovid brands. It also provides medicines and vaccines in various therapeutic areas, such as biosimilars for chronic immune and inflammatory diseases under the Xeljanz, Enbrel, Inflectra, Litfulo, Velsipity, and Cibinqo brands; amyloidosis, hemophilia, endocrine diseases, and sickle cell disease under the Vyndaqel family, Oxbryta, BeneFIX, Somavert, Ngenla, and Genotropin brands; sterile injectable and anti-infective medicines under the Sulperazon, Medrol, Zavicefta, Zithromax, and Panzyga brands; and biologics, small molecules, immunotherapies, and biosimilars under the Ibrance, Xtandi, Inlyta, Bosulif, Mektovi, Padcev, Adcetris, Talzenna, Tukysa, Elrexfio, Tivdak, Lorbrena, and Braftovi brands. In addition, the company involved in the contract manufacturing business. It serves wholesalers, retailers, hospitals, clinics, government agencies, pharmacies, individual provider offices, retail pharmacies, and integrated delivery systems. The company has collaboration agreements with Bristol-Myers Squibb Company; Astellas Pharma US, Inc.; Merck KGaA; and BioNTech SE. Pfizer Inc. was founded in 1849 and is headquartered in New York, New York.
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.
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