Zai Lab (NASDAQ:ZLAB – Get Free Report) and Amneal Pharmaceuticals (NASDAQ:AMRX – Get Free Report) are both mid-cap medical companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, earnings, profitability, risk and dividends.
Analyst Recommendations
This is a summary of recent ratings and target prices for Zai Lab and Amneal Pharmaceuticals, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Zai Lab | 0 | 0 | 4 | 0 | 3.00 |
| Amneal Pharmaceuticals | 0 | 1 | 4 | 0 | 2.80 |
Zai Lab presently has a consensus price target of $52.50, indicating a potential upside of 72.36%. Amneal Pharmaceuticals has a consensus price target of $9.40, indicating a potential upside of 10.72%. Given Zai Lab’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Zai Lab is more favorable than Amneal Pharmaceuticals.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Zai Lab | $266.72 million | 11.38 | -$334.62 million | ($3.06) | -9.95 |
| Amneal Pharmaceuticals | $2.60 billion | 1.01 | -$83.99 million | ($0.62) | -13.69 |
Amneal Pharmaceuticals has higher revenue and earnings than Zai Lab. Amneal Pharmaceuticals is trading at a lower price-to-earnings ratio than Zai Lab, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
41.7% of Zai Lab shares are held by institutional investors. Comparatively, 31.8% of Amneal Pharmaceuticals shares are held by institutional investors. 13.9% of Zai Lab shares are held by company insiders. Comparatively, 26.6% of Amneal Pharmaceuticals shares are held by company 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.
Profitability
This table compares Zai Lab and Amneal Pharmaceuticals’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Zai Lab | -92.44% | -37.96% | -29.42% |
| Amneal Pharmaceuticals | -6.72% | 1,235.03% | 4.64% |
Volatility & Risk
Zai Lab has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500. Comparatively, Amneal Pharmaceuticals has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.
Summary
Amneal Pharmaceuticals beats Zai Lab on 8 of the 13 factors compared between the two stocks.
About Zai Lab
Zai Lab Limited develops and commercializes therapies to treat oncology, autoimmune disorders, infectious diseases, and neuroscience. Its commercial products include Zejula, an orally administered poly polymerase 1/2 inhibitor; Optune, a cancer therapy that uses electric fields tuned to specific frequencies to kill tumor cells; NUZYRA for acute bacterial skin and skin structure infections, and community acquired bacterial pneumonia; Qinlock to treat gastrointestinal stromal tumors, and VYVGART, a human IgG1 antibody fragment for myesthenia gravis. The company also develops Tumor Treating Fields, a portable device for delivery of electric fields; Repotrectinib, a tyrosine kinase inhibitor (TKI) to target ROS1 and TRK A/B/C in TKI-naïve- or -pretreated cancer patients; Tisotumab vedotin, an antibody drug conjugate; Adagrasib for treating KRAS-G12C-mutated NSCLC, colorectal cancer, and pancreatic cancer; and Bemarituzumab to treat gastric and gastroesophageal junction cancer patients. In addition, it develops Sulbactam/durlobactam, a combination of a beta-lactam antibiotic and a beta-lactamase inhibitor for the treatment of serious infections caused by Acinetobacter; KarXT for the treatment of psychiatric and neurological conditions. It has license and collaboration agreement with Tesaro, Inc. to develop, manufacture, and commercialize niraparib; NovoCure to develop and commercialize Tumor Treating Fields; Deciphera to develop and commercialize ripretinib; Paratek Bermuda Ltd. to develop, manufacture, and commercialize omadacycline; argenx, to develop and commercialize efgartigimod; BMS to develop and commercialize tisotumab vedotin and repotrectinib; Mirati to research, develop, manufacture, and commercialize adagrasib; Amgen to develop and commercialize bemarituzumab; and Innoviva to develop and commercialize Sulbactam-Durlobactam; Karuna to develop and commercialize KarXT. The company was incorporated in 2013 and is headquartered in Shanghai, China.
About Amneal Pharmaceuticals
Amneal Pharmaceuticals, Inc., together with its subsidiaries, develops, manufactures, markets, and distributes generics, injectables, biosimilars, and specialty branded pharmaceutical products worldwide. The company operates through three segments: Generics, Specialty, and AvKARE. The Generics segment offers immediate and extended release oral solid, powder, liquid, sterile injectable, nasal spray, inhalation and respiratory, biosimilar, ophthalmic, film, transdermal patch, and topical products. The Specialty segment develops, promotes, sells, and distributes pharmaceutical products with focus on central nervous system disorders, including Parkinson's disease, and endocrine disorders. This segment also provides Rytary, an oral capsule formulation of carbidopa-levodopa to treat Parkinson's disease, post-encephalitic parkinsonism, and parkinsonism; Unithroid for the treatment of hypothyroidism; and IPX203, a pipeline product for Parkinson's disease. The AvKARE segment offers pharmaceuticals, medical and surgical products, and services primarily to governmental agencies, the Department of Defense, and the Department of Veterans Affairs. This segment also distributes bottle and unit dose pharmaceuticals under the AvKARE and AvPAK names; and packages and distributes pharmaceuticals and vitamins to its retail and institutional customers. It sells its products through wholesalers, distributors, hospitals, chain pharmacies, and individual pharmacies. The company was formerly known as Atlas Holdings, Inc. and changed its name to Amneal Pharmaceuticals, Inc. in 2018. Amneal Pharmaceuticals, Inc. was founded in 2002 and is headquartered in Bridgewater, New Jersey.
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