Critical Analysis: Chugai Pharmaceutical (OTCMKTS:CHGCY) & Pfizer (NYSE:PFE)

Pfizer (NYSE:PFE) and Chugai Pharmaceutical (OTCMKTS:CHGCY) are both large-cap healthcare companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and price targets for Pfizer and Chugai Pharmaceutical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pfizer	2	14	5	0	2.14
Chugai Pharmaceutical	0	3	1	1	2.60

Pfizer presently has a consensus price target of $28.72, indicating a potential upside of 1.47%. Given Pfizer’s higher probable upside, analysts clearly believe Pfizer is more favorable than Chugai Pharmaceutical.

Valuation & Earnings

This table compares Pfizer and Chugai Pharmaceutical”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pfizer	$62.58 billion	2.58	$7.77 billion	$0.76	37.24
Chugai Pharmaceutical	$8.41 billion	7.52	$2.91 billion	$0.92	20.91

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

Institutional & Insider Ownership

68.4% of Pfizer shares are owned by institutional investors. Comparatively, 0.0% of Chugai Pharmaceutical shares are owned by institutional investors. 0.6% of Pfizer shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Pfizer pays an annual dividend of $1.72 per share and has a dividend yield of 6.1%. Chugai Pharmaceutical pays an annual dividend of $0.25 per share and has a dividend yield of 1.3%. Pfizer pays out 226.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chugai Pharmaceutical pays out 27.2% of its earnings in the form of a dividend. Pfizer has raised its dividend for 16 consecutive years. Pfizer is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Pfizer has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500. Comparatively, Chugai Pharmaceutical has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500.

Profitability

This table compares Pfizer and Chugai Pharmaceutical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pfizer	6.80%	19.63%	8.46%
Chugai Pharmaceutical	35.09%	23.76%	19.92%

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 Chugai Pharmaceutical

Chugai Pharmaceutical Co., Ltd., together with its subsidiaries, engages in the research, development, manufacture, sale, importation, and exportation of pharmaceuticals in Japan and internationally. The company’s products for oncology primarily include Avastin, FoundationOne, Polivy, Rozlytrek, Tecentriq, Perjeta, Alecensa, Herceptin, Kadcyla, Rituxan, and Gazyva; Edirol, an Osteoporosis agent; Mircera, an erythropoiesis agent; Oxarol, an agent for secondary hyperparathyroidism; and other diseases comprise Hemlibra, CellCept, Bonviva, Tamiflu, Evrysdi, Ronapreve, Vabysmo, and Enspryng. It has various development product candidates in the areas of oncology, immunology, neuroscience, hematology, ophthalmology, and other diseases. Chugai Pharmaceutical Co., Ltd. has strategic alliances and collaboration with Roche Group. The company was founded in 1925 and is headquartered in Chuo, Japan. Chugai Pharmaceutical Co., Ltd. operates as a subsidiary of Roche Holding Ltd.