Comparing Merck & Co., Inc. (MRK) and Aegerion Pharmaceuticals (AEGR)

Merck & Co., Inc. (NYSE: MRK) and Aegerion Pharmaceuticals (NASDAQ:AEGR) are both healthcare companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, profitability, earnings, institutional ownership and risk.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Merck & Co., Inc. and Aegerion Pharmaceuticals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Merck & Co., Inc. 1 8 9 0 2.44
Aegerion Pharmaceuticals 0 0 0 0 N/A

Merck & Co., Inc. presently has a consensus price target of $66.00, indicating a potential upside of 16.48%. Given Merck & Co., Inc.’s higher probable upside, equities research analysts clearly believe Merck & Co., Inc. is more favorable than Aegerion Pharmaceuticals.

Risk and Volatility

Merck & Co., Inc. has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, Aegerion Pharmaceuticals has a beta of 0.5, meaning that its share price is 50% less volatile than the S&P 500.

Insider & Institutional Ownership

73.6% of Merck & Co., Inc. shares are owned by institutional investors. Comparatively, 84.9% of Aegerion Pharmaceuticals shares are owned by institutional investors. 0.3% of Merck & Co., Inc. shares are owned by company insiders. Comparatively, 4.6% of Aegerion Pharmaceuticals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Merck & Co., Inc. pays an annual dividend of $1.92 per share and has a dividend yield of 3.4%. Aegerion Pharmaceuticals does not pay a dividend. Merck & Co., Inc. pays out 186.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Aegerion Pharmaceuticals has increased its dividend for 6 consecutive years.

Profitability

This table compares Merck & Co., Inc. and Aegerion Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Merck & Co., Inc. -0.49% -0.58% -0.22%
Aegerion Pharmaceuticals -75.07% N/A -29.21%

Earnings and Valuation

This table compares Merck & Co., Inc. and Aegerion Pharmaceuticals’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Merck & Co., Inc. $39.81 billion 3.88 $3.92 billion $1.03 55.01
Aegerion Pharmaceuticals N/A N/A N/A ($5.97) -0.33

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

Summary

Merck & Co., Inc. beats Aegerion Pharmaceuticals on 9 of the 14 factors compared between the two stocks.

About Merck & Co., Inc.

Merck & Co., Inc. is a global healthcare company. The Company offers health solutions through its prescription medicines, vaccines, biologic therapies and animal health products. It operates through four segments: Pharmaceutical, Animal Health, Healthcare Services and Alliances. The Company’s Pharmaceutical segment includes human health pharmaceutical and vaccine products marketed either directly by the Company or through joint ventures. Human health pharmaceutical products consist of therapeutic and preventive agents, generally sold by prescription, for the treatment of human disorders. The Company sells its human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals, government agencies and managed healthcare providers, such as health maintenance organizations, pharmacy benefit managers and other institutions. Vaccine products consist of preventive pediatric, adolescent and adult vaccines, primarily administered at physician offices.

About Aegerion Pharmaceuticals

Aegerion Pharmaceuticals, Inc. is a biopharmaceutical company engaged in the development and commercialization of therapies for patients with debilitating rare diseases. It operates through pharmaceuticals segment. Its products include lomitapide and metreleptin. Lomitapide is a small molecule microsomal triglyceride transfer protein (MTP) inhibitor. Lomitapide received marketing approval under the brand name Juxtapid (lomitapide) capsules from the United States Food and Drug Administration (FDA) as an adjunct to a low-fat diet and other lipid-lowering treatments. It also received marketing authorization for lomitapide in the European Union (EU) under the brand name LOJUXTA (lomitapide) hard capsules (LOJUXTA) as a treatment for HoFH in adults. Metreleptin is a recombinant human leptin analog that exerts its function by binding to and activating the human leptin receptor. Metreleptin is marketed in the United States under the brand name MYALEPT (metreleptin) for injection (MYALEPT).

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