Perrigo Company (NYSE: PRGO) and USANA Health Sciences (NYSE:USNA) are both medical companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, profitabiliy, risk, earnings and dividends.

Risk and Volatility

Perrigo Company has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500. Comparatively, USANA Health Sciences has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500.

Profitability

This table compares Perrigo Company and USANA Health Sciences’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Perrigo Company -43.81% 11.79% 5.43%
USANA Health Sciences 9.71% 31.84% 22.35%

Insider & Institutional Ownership

76.4% of Perrigo Company shares are owned by institutional investors. Comparatively, 44.3% of USANA Health Sciences shares are owned by institutional investors. 4.5% of Perrigo Company shares are owned by insiders. Comparatively, 53.2% of USANA Health Sciences shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Perrigo Company and USANA Health Sciences, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Perrigo Company 2 10 4 0 2.13
USANA Health Sciences 0 1 1 0 2.50

Perrigo Company currently has a consensus target price of $83.69, suggesting a potential upside of 16.73%. USANA Health Sciences has a consensus target price of $112.50, suggesting a potential upside of 72.94%. Given USANA Health Sciences’ stronger consensus rating and higher possible upside, analysts plainly believe USANA Health Sciences is more favorable than Perrigo Company.

Dividends

Perrigo Company pays an annual dividend of $0.64 per share and has a dividend yield of 0.9%. USANA Health Sciences does not pay a dividend. Perrigo Company pays out -3.9% of its earnings in the form of a dividend. Perrigo Company has raised its dividend for 14 consecutive years.

Earnings and Valuation

This table compares Perrigo Company and USANA Health Sciences’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Perrigo Company $5.13 billion 2.00 $1.12 billion ($16.39) -4.37
USANA Health Sciences $1.02 billion 1.56 $151.43 million $3.97 16.41

Perrigo Company has higher revenue and earnings than USANA Health Sciences. Perrigo Company is trading at a lower price-to-earnings ratio than USANA Health Sciences, indicating that it is currently the more affordable of the two stocks.

About Perrigo Company

Perrigo Company plc is a global healthcare supplier that develops, manufactures and distributes over-the-counter (OTC) and generic prescription (Rx) pharmaceuticals, infant formulas, nutritional products, animal health, dietary supplements, active pharmaceutical ingredients (API), and medical diagnostic products, and Multiple Sclerosis drug Tysabri. Its businesses include Consumer Healthcare, Nutritionals, Rx Pharmaceuticals, API, Life Sciences and Other Businesses. The Company offers Healthcare Products across a range of product categories primarily in the United States, the United Kingdom, Mexico, Israel and Australia. In February 2014, the Company announced that it has acquired a basket of value-brand OTC products sold in Australia and New Zealand from Aspen Global Inc.

About USANA Health Sciences

USANA Health Sciences, Inc. develops and manufactures science-based nutritional and personal care products. The Company operates as a direct selling company in two geographic regions: Americas and Europe, and Asia Pacific, which includes three sub-regions: Southeast Asia Pacific, Greater China and North Asia. Its product lines include USANA Nutritionals Essentials, Optimizers, Foods, Sense-beautiful science and All Other. Its USANA Nutritionals Essentials product line includes vitamin and mineral supplements that provide a foundation of total body nutrition for every age group beginning with children of approximately one year. Its Optimizers product line consists of targeted supplements designed to meet individual health and nutritional needs. Its Sense-beautiful science product line includes science-based, personal care products that support skin and hair by providing topical nourishment, moisturization and protection.

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