Critical Contrast: Eyegate Pharmaceuticals (EYEG) & Merck & Co., Inc. (MRK)

Eyegate Pharmaceuticals (NASDAQ: EYEG) and Merck & Co., Inc. (NYSE:MRK) are both healthcare companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.

Earnings & Valuation

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Eyegate Pharmaceuticals $670,000.00 30.55 -$13.34 million ($1.17) -1.02
Merck & Co., Inc. $39.81 billion 4.19 $3.92 billion $1.03 59.50

Merck & Co., Inc. has higher revenue and earnings than Eyegate Pharmaceuticals. Eyegate 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.

Institutional & Insider Ownership

12.0% of Eyegate Pharmaceuticals shares are held by institutional investors. Comparatively, 73.7% of Merck & Co., Inc. shares are held by institutional investors. 24.6% of Eyegate Pharmaceuticals shares are held by company insiders. Comparatively, 0.3% of Merck & Co., Inc. shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

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

Net Margins Return on Equity Return on Assets
Eyegate Pharmaceuticals -2,480.28% -1,494.75% -100.47%
Merck & Co., Inc. 11.60% 27.08% 11.41%

Dividends

Merck & Co., Inc. pays an annual dividend of $1.92 per share and has a dividend yield of 3.1%. Eyegate 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. Eyegate Pharmaceuticals has increased its dividend for 6 consecutive years.

Analyst Ratings

This is a breakdown of recent recommendations for Eyegate Pharmaceuticals and Merck & Co., Inc., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eyegate Pharmaceuticals 0 0 2 0 3.00
Merck & Co., Inc. 0 8 8 0 2.50

Eyegate Pharmaceuticals currently has a consensus target price of $5.00, indicating a potential upside of 320.17%. Merck & Co., Inc. has a consensus target price of $66.87, indicating a potential upside of 9.12%. Given Eyegate Pharmaceuticals’ stronger consensus rating and higher possible upside, equities analysts clearly believe Eyegate Pharmaceuticals is more favorable than Merck & Co., Inc..

Summary

Merck & Co., Inc. beats Eyegate Pharmaceuticals on 10 of the 16 factors compared between the two stocks.

About Eyegate Pharmaceuticals

Eyegate Pharmaceuticals, Inc. is a clinical-stage specialty pharmaceutical company. The Company is focused on developing and commercializing therapeutics and drug delivery systems for treating diseases of the eye. The Company’s lead product, EGP-437, incorporates a reformulated topically active corticosteroid, dexamethasone phosphate, which is delivered into the ocular tissues through its drug delivery system, the EyeGate II Delivery System. The Company is developing EGP-437 for the treatment of various inflammatory conditions of the eye, including uveitis, a debilitating form of intraocular inflammation of the anterior portion of the uvea, such as the iris and/or ciliary body, and macular edema, an abnormal thickening of the macula associated with the accumulation of excess fluids in the extracellular space of the neurosensory retina. The EyeGate II Delivery System is designed to deliver optimal quantities of drugs to the anterior or posterior segments of the eye.

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.

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