Critical Review: Amarin (NASDAQ:AMRN) & Amneal Pharmaceuticals (NASDAQ:AMRX)

Amneal Pharmaceuticals (NASDAQ:AMRX) and Amarin (NASDAQ:AMRN) are both healthcare companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Amneal Pharmaceuticals and Amarin, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amneal Pharmaceuticals	0	1	9	0	2.90
Amarin	2	1	0	0	1.33

Amneal Pharmaceuticals currently has a consensus price target of $22.75, suggesting a potential upside of 11.88%. Amarin has a consensus price target of $13.00, suggesting a potential upside of 7.38%. Given Amneal Pharmaceuticals’ stronger consensus rating and higher possible upside, analysts plainly believe Amneal Pharmaceuticals is more favorable than Amarin.

Risk and Volatility

Amneal Pharmaceuticals has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500. Comparatively, Amarin has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500.

Earnings & Valuation

This table compares Amneal Pharmaceuticals and Amarin”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Amneal Pharmaceuticals	$3.20 billion	2.03	$72.06 million	$0.42	48.41
Amarin	$213.65 million	1.20	-$38.80 million	($0.96)	-12.61

Amneal Pharmaceuticals has higher revenue and earnings than Amarin. Amarin is trading at a lower price-to-earnings ratio than Amneal Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Amneal Pharmaceuticals and Amarin’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Amneal Pharmaceuticals	4.17%	283.50%	7.79%
Amarin	-10.87%	-0.52%	-0.36%

Insider & Institutional Ownership

31.8% of Amneal Pharmaceuticals shares are held by institutional investors. Comparatively, 22.3% of Amarin shares are held by institutional investors. 17.3% of Amneal Pharmaceuticals shares are held by company insiders. Comparatively, 4.2% of Amarin shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Amneal Pharmaceuticals beats Amarin on 14 of the 14 factors compared between the two stocks.

About Amneal Pharmaceuticals

Amneal Pharmaceuticals, Inc., together with its subsidiaries, develops, manufactures, markets, and distributes generics, injectables, biosimilars, and specialty branded pharmaceutical products worldwide. The company operates through three segments: Generics, Specialty, and AvKARE. The Generics segment offers immediate and extended release oral solid, powder, liquid, sterile injectable, nasal spray, inhalation and respiratory, biosimilar, ophthalmic, film, transdermal patch, and topical products. The Specialty segment develops, promotes, sells, and distributes pharmaceutical products with focus on central nervous system disorders, including Parkinson's disease, and endocrine disorders. This segment also provides Rytary, an oral capsule formulation of carbidopa-levodopa to treat Parkinson's disease, post-encephalitic parkinsonism, and parkinsonism; Unithroid for the treatment of hypothyroidism; and IPX203, a pipeline product for Parkinson's disease. The AvKARE segment offers pharmaceuticals, medical and surgical products, and services primarily to governmental agencies, the Department of Defense, and the Department of Veterans Affairs. This segment also distributes bottle and unit dose pharmaceuticals under the AvKARE and AvPAK names; and packages and distributes pharmaceuticals and vitamins to its retail and institutional customers. It sells its products through wholesalers, distributors, hospitals, chain pharmacies, and individual pharmacies. The company was formerly known as Atlas Holdings, Inc. and changed its name to Amneal Pharmaceuticals, Inc. in 2018. Amneal Pharmaceuticals, Inc. was founded in 2002 and is headquartered in Bridgewater, New Jersey.

About Amarin

Amarin Corporation plc, a pharmaceutical company, engages in the development and commercialization of therapeutics for the treatment of cardiovascular diseases in the United States, European countries, Canada, Lebanon, and the United Arab Emirates. The company offers VASCEPA, a prescription-only omega-3 fatty acid product, used as an adjunct to diet for reducing triglyceride levels in adult patients with severe hypertriglyceridemia. It sells its products principally to wholesalers and specialty pharmacy providers. The company has a collaboration with Mochida Pharmaceutical Co., Ltd. to develop and commercialize drug products and indications based on the active pharmaceutical ingredient in Vascepa. The company was formerly known as Ethical Holdings plc and changed its name to Amarin Corporation plc in 1999. Amarin Corporation plc was incorporated in 1989 and is headquartered in Dublin, Ireland.