Head-To-Head Survey: Novartis (NVS) & Cadence Pharmaceuticals (CADX)

Novartis (NYSE: NVS) and Cadence Pharmaceuticals (NASDAQ:CADX) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, risk, dividends, earnings and profitability.

Institutional & Insider Ownership

10.9% of Novartis shares are held by institutional investors. 0.0% of Novartis shares are held 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

Novartis pays an annual dividend of $2.30 per share and has a dividend yield of 2.6%. Cadence Pharmaceuticals 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.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Novartis and Cadence Pharmaceuticals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Novartis 4 5 4 0 2.00
Cadence Pharmaceuticals 0 0 0 0 N/A

Novartis presently has a consensus target price of $84.41, indicating a potential downside of 2.92%.

Profitability

This table compares Novartis and Cadence Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Novartis 13.73% 15.77% 8.46%
Cadence Pharmaceuticals N/A N/A N/A

Valuation and Earnings

This table compares Novartis and Cadence Pharmaceuticals’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Novartis $48.52 billion 4.24 $6.71 billion $2.81 30.94
Cadence Pharmaceuticals N/A N/A N/A N/A N/A

Novartis has higher revenue and earnings than Cadence Pharmaceuticals.

Summary

Novartis beats Cadence Pharmaceuticals on 8 of the 9 factors compared between the two stocks.

Novartis Company Profile

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.

Cadence Pharmaceuticals Company Profile

Cadence Pharmaceuticals, Inc. (Cadence) is a biopharmaceutical company focused on acquiring, in-licensing, developing and commercializing products principally for use in the hospital setting. The Company has rights to one product, OFIRMEV (acetaminophen) injection, an intravenous (IV), formulation of acetaminophen. The Company in-licensed the United States, and Canadian rights to OFIRMEV from Bristol-Myers Squibb Company (BMS), which sells intravenous acetaminophen in Europe and other markets for the treatment of acute pain and fever under the brand name Perfalgan. In March 2014, Mallinckrodt Plc acquired Cadence Pharmaceuticals, Inc. In March 2014, Mallinckrodt Plc completed the acquisition of Cadence Pharmaceuticals.

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