Novartis (NVS) and BioDelivery Sciences International (BDSI) Head to Head Comparison

Novartis (NYSE: NVS) and BioDelivery Sciences International (NASDAQ:BDSI) are both healthcare companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.

Dividends

Novartis pays an annual dividend of $2.30 per share and has a dividend yield of 2.7%. BioDelivery Sciences International does not pay a dividend. Novartis pays out 81.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BioDelivery Sciences International has increased its dividend for 2 consecutive years.

Earnings & Valuation

This table compares Novartis and BioDelivery Sciences International’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Novartis $48.52 billion 4.22 $6.71 billion $2.81 30.84
BioDelivery Sciences International $15.55 million 10.17 -$67.13 million $0.09 31.44

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

Institutional and Insider Ownership

10.9% of Novartis shares are owned by institutional investors. Comparatively, 44.1% of BioDelivery Sciences International shares are owned by institutional investors. 0.0% of Novartis shares are owned by company insiders. Comparatively, 7.7% of BioDelivery Sciences International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Novartis and BioDelivery Sciences International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Novartis 4 6 4 0 2.00
BioDelivery Sciences International 0 1 5 0 2.83

Novartis currently has a consensus target price of $84.41, indicating a potential downside of 2.59%. BioDelivery Sciences International has a consensus target price of $4.50, indicating a potential upside of 59.01%. Given BioDelivery Sciences International’s stronger consensus rating and higher possible upside, analysts plainly believe BioDelivery Sciences International is more favorable than Novartis.

Risk and Volatility

Novartis has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, BioDelivery Sciences International has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500.

Profitability

This table compares Novartis and BioDelivery Sciences International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Novartis 13.73% 15.77% 8.46%
BioDelivery Sciences International 10.40% 33.83% 6.43%

Summary

BioDelivery Sciences International beats Novartis on 10 of the 16 factors compared between the two stocks.

About Novartis

Novartis AG is a holding company, which provides healthcare solutions. The Company is engaged in the research, development, manufacturing and marketing of a range of healthcare products led by pharmaceuticals. The Company’s segments include Innovative Medicines, Sandoz, Alcon and Corporate activities. Innovative Medicines researches, develops, manufactures, distributes and sells patented prescription medicines to develop health outcomes for patients and healthcare providers. Sandoz develops, manufactures, distributes and sells prescription medicines, as well as pharmaceutical active substances that are not protected by valid and enforceable third-party patents. Alcon researches, develops, manufactures, distributes and sells eye care products. Alcon is a provider of eye care with product offerings in eye care devices and vision care. The Company’s range of products includes pharmaceuticals and oncology medicines, generic and biosimilar medicines, and eye care devices.

About BioDelivery Sciences International

BioDelivery Sciences International, Inc. is a specialty pharmaceutical company. The Company develops and commercializes, either on its own or in partnerships with third parties, applications of approved therapeutics to address unmet medical needs using drug delivery technologies. The Company develops pharmaceutical products aimed principally in the areas of pain management and addiction. The Company’s products utilize the BioErodible MucoAdhesive (BEMA) drug delivery technology, a small, erodible polymer film for application to the buccal mucosa (the lining inside the cheek). The Company’s United Sates Food and Drug Administration (FDA) approved product, ONSOLIS (fentanyl buccal soluble film), as well as its approved products BUNAVAIL (buprenorphine and naloxone buccal film) buccal film and BELBUCA (buprenorphine) buccal film, utilize BEMA technology.

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