Financial Comparison: Madrigal Pharmaceuticals (NASDAQ:MDGL) & Zoetis (NYSE:ZTS)

Zoetis (NYSE:ZTS) and Madrigal Pharmaceuticals (NASDAQ:MDGL) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings and target prices for Zoetis and Madrigal Pharmaceuticals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zoetis	0	5	5	0	2.50
Madrigal Pharmaceuticals	1	1	9	0	2.73

Zoetis presently has a consensus price target of $200.88, suggesting a potential upside of 37.16%. Madrigal Pharmaceuticals has a consensus price target of $495.88, suggesting a potential upside of 11.93%. Given Zoetis’ higher possible upside, equities analysts plainly believe Zoetis is more favorable than Madrigal Pharmaceuticals.

Volatility & Risk

Zoetis has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, Madrigal Pharmaceuticals has a beta of -1.02, meaning that its share price is 202% less volatile than the S&P 500.

Institutional and Insider Ownership

92.8% of Zoetis shares are owned by institutional investors. Comparatively, 98.5% of Madrigal Pharmaceuticals shares are owned by institutional investors. 0.2% of Zoetis shares are owned by insiders. Comparatively, 21.5% of Madrigal Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Zoetis and Madrigal Pharmaceuticals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zoetis	27.83%	56.90%	19.54%
Madrigal Pharmaceuticals	-54.68%	-38.38%	-27.32%

Valuation and Earnings

This table compares Zoetis and Madrigal Pharmaceuticals”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zoetis	$9.26 billion	7.01	$2.49 billion	$5.81	25.21
Madrigal Pharmaceuticals	$180.13 million	54.60	-$465.89 million	($12.85)	-34.48

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

Summary

Zoetis beats Madrigal Pharmaceuticals on 9 of the 14 factors compared between the two stocks.

About Zoetis

Zoetis Inc. engages in the discovery, development, manufacture, and commercialization of animal health medicines, vaccines, and diagnostic products and services in the United States and internationally. The company commercializes products primarily across species, including livestock, such as cattle, swine, poultry, fish, and sheep and others; and companion animals comprising dogs, cats, and horses. It also offers parasiticides, vaccines, dermatology, other pharmaceutical, anti-infectives, animal health diagnostics, and medicated feed additives. In addition, the company provides animal health diagnostics, including point-of-care diagnostic products, instruments and reagents, rapid immunoassay tests, reference laboratory kits and services, and blood glucose monitors; and other non-pharmaceutical products, which include nutritionals, as well as products and services in biodevices, genetic tests, and precision animal health. It markets its products to veterinarians, livestock producers, and pet owners. The company has collaboration Blacksmith Medicines, Inc. to discover and develop novel antibiotics for animal health. Zoetis Inc. was founded in 1952 and is headquartered in Parsippany, New Jersey.

About Madrigal Pharmaceuticals

Madrigal Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development of therapeutics for the treatment of non-alcoholic steatohepatitis (NASH) in the United States. Its lead product candidate is resmetirom, a liver-directed thyroid hormone receptor beta agonist, which is in Phase 3 clinical trials for treating NASH. The company is headquartered in West Conshohocken, Pennsylvania.