Perrigo (NYSE:PRGO – Get Free Report) and United-Guardian (NASDAQ:UG – Get Free Report) are both small-cap medical companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, dividends, risk, analyst recommendations, valuation and institutional ownership.
Dividends
Perrigo pays an annual dividend of $1.16 per share and has a dividend yield of 10.6%. United-Guardian pays an annual dividend of $0.50 per share and has a dividend yield of 7.9%. Perrigo pays out -11.3% of its earnings in the form of a dividend. United-Guardian pays out 116.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Perrigo has increased its dividend for 23 consecutive years and United-Guardian has increased its dividend for 1 consecutive years. Perrigo is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Perrigo and United-Guardian, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Perrigo | 1 | 4 | 1 | 0 | 2.00 |
| United-Guardian | 1 | 0 | 0 | 0 | 1.00 |
Earnings & Valuation
This table compares Perrigo and United-Guardian”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Perrigo | $4.25 billion | 0.36 | -$1.43 billion | ($10.28) | -1.07 |
| United-Guardian | $12.18 million | 2.37 | $3.25 million | $0.43 | 14.65 |
United-Guardian has lower revenue, but higher earnings than Perrigo. Perrigo is trading at a lower price-to-earnings ratio than United-Guardian, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Perrigo and United-Guardian’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Perrigo | -33.51% | 9.41% | 3.97% |
| United-Guardian | 19.48% | 17.51% | 15.04% |
Volatility & Risk
Perrigo has a beta of 0.41, indicating that its share price is 59% less volatile than the S&P 500. Comparatively, United-Guardian has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.
Insider & Institutional Ownership
95.9% of Perrigo shares are owned by institutional investors. Comparatively, 23.2% of United-Guardian shares are owned by institutional investors. 0.7% of Perrigo shares are owned by insiders. Comparatively, 29.0% of United-Guardian shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Summary
United-Guardian beats Perrigo on 9 of the 17 factors compared between the two stocks.
About Perrigo
Perrigo Company plc provides over-the-counter health and wellness solutions to enhance individual well-being in the United States, Europe, and internationally. It operates through Consumer Self-Care Americas and Consumer Self-Care International segments. The company develops, manufactures, markets, and distributes self-care consumer products, such as upper respiratory products, including cough suppressants, expectorants, and sinus and allergy relief; nutrition products consisting of infant formulas and nutritional beverages; digestive health products, including antacids, anti-diarrheal, and anti-heartburn; pain and sleep-aids products comprising pain relievers and fever reducers; and oral care products, which include toothbrushes, toothbrush replacement heads, floss, flossers, whitening products, and toothbrush covers. It also offers healthy lifestyle products, such as smoking cessation, well-being, and weight management products; skin care products consisting of dermatological care, scar management, lice treatment, and other products for various skin conditions; women's health products comprising feminine hygiene and contraceptives; vitamins, minerals, and supplements; rare diseases business; and other miscellaneous self-care products. The company sells its products under the Compeed, Dr. Fresh, Firefly, Good Sense, Good Start, Mederma, Nasonex, Plackers, Prevacid24HR, REACH, Rembrandt, Steripod, Opill, Solpadeine, Coldrex, Physiomer, NiQuitin, ACO, ellaOne, Compeed Stops, XLS, Arterin, Davitamon, Apiserum, Abtei, and Nicorette brands. It also offers contract manufacturing services. The company sells its products through retail drug, supermarket, and mass merchandise chains; e-commerce stores; wholesalers; pharmacies; drug and grocery retailers; and para-pharmacies. The company was formerly known as Perrigo Company and changed its name to Perrigo Company plc in December 2013. Perrigo Company plc was founded in 1887 and is headquartered in Dublin, Ireland.
About United-Guardian
United-Guardian, Inc. manufactures and markets cosmetic ingredients, pharmaceuticals, medical lubricants, and proprietary specialty industrial products in the United States and internationally The company offers cosmetic ingredients, including LUBRAJEL, a line of water-based gel formulation for sensory enhancement, lubrication, and texture to personal care products; LUBRAJEL NATURAL for skin moisturizing; LUBRAJEL MARINE that develops natural products using naturally derived polymers; LUBRAJEL OlL NATURAL, which makes luxuriant textures without adding viscosity; LUBRAJEL TERRA, a multifunctional, moisturizing hydrogel products; LUBRASIL II SB, a formulation of LUBRAJEL; LUBRAJEL II XD; B-122, a powdered lubricant used in the manufacture of pressed powders, eyeliners, rouges, and industrial products; and ORCHID COMPLEX, an oil-soluble base for extract of fresh orchids used in fragrance products, such as perfumes and toiletries. Its medical lubricants comprise LUBRAJEL RR and RC, which are water-based lubricant gels for urinary catheters; LUBRAJEL MG to lubricate urinary catheters, pre-lubricated enema tips, and other medical devices; LUBRAJEL MGL, a medical lubricant with a lower viscosity medical lubricant; LUBRAJEL LC, LUBRAJEL BA, and LUBRAJEL FA, which are formulations for oral care; and LUBRAJEL FLUID to lubricate water-soluble products. The company's pharmaceutical products consist of RENACIDIN, a prescription drug to prevent and dissolve calcifications in urethral catheters and the urinary bladder; and CLORPACTIN WCS-90, an antimicrobial used in urology. Its industrial products include DESELEX, a sequestering and chelating agent used for manufacturing detergents; and THOROCLENS, a chlorine-based industrial cleanser. The company also conducts research and product development of cosmetic ingredients. The company was founded in 1942 and is based in Hauppauge, New York.
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