Amphastar Pharmaceuticals (AMPH) vs. Taro Pharmaceutical Industries (NYSE:TARO) Head to Head Analysis

Amphastar Pharmaceuticals (NASDAQ: AMPH) and Taro Pharmaceutical Industries (NYSE:TARO) are both medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitabiliy, institutional ownership, earnings, risk, dividends, valuation and analyst recommendations.

Institutional & Insider Ownership

45.3% of Amphastar Pharmaceuticals shares are held by institutional investors. Comparatively, 16.5% of Taro Pharmaceutical Industries shares are held by institutional investors. 11.1% of Amphastar Pharmaceuticals shares are held by insiders. Comparatively, 13.8% of Taro Pharmaceutical Industries shares are held by 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.

Valuation and Earnings

This table compares Amphastar Pharmaceuticals and Taro Pharmaceutical Industries’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Amphastar Pharmaceuticals $252.47 million 3.25 $25.34 million $0.19 94.48
Taro Pharmaceutical Industries $879.39 million 5.26 $530.06 million $11.06 10.33

Taro Pharmaceutical Industries has higher revenue and earnings than Amphastar Pharmaceuticals. Taro Pharmaceutical Industries is trading at a lower price-to-earnings ratio than Amphastar Pharmaceuticals, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Amphastar Pharmaceuticals and Taro Pharmaceutical Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amphastar Pharmaceuticals 3.54% 2.69% 2.04%
Taro Pharmaceutical Industries 51.90% 23.08% 20.63%

Analyst Recommendations

This is a summary of recent recommendations for Amphastar Pharmaceuticals and Taro Pharmaceutical Industries, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amphastar Pharmaceuticals 0 1 5 0 2.83
Taro Pharmaceutical Industries 0 1 0 0 2.00

Amphastar Pharmaceuticals currently has a consensus price target of $20.17, indicating a potential upside of 12.35%. Given Amphastar Pharmaceuticals’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Amphastar Pharmaceuticals is more favorable than Taro Pharmaceutical Industries.

Volatility and Risk

Amphastar Pharmaceuticals has a beta of 1.68, indicating that its share price is 68% more volatile than the S&P 500. Comparatively, Taro Pharmaceutical Industries has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.

Summary

Taro Pharmaceutical Industries beats Amphastar Pharmaceuticals on 8 of the 14 factors compared between the two stocks.

Amphastar Pharmaceuticals Company Profile

Amphastar Pharmaceuticals, Inc. is a specialty pharmaceutical company. The Company focuses primarily on developing, manufacturing, marketing and selling generic and injectable, inhalation and intranasal products. The Company has two segments: finished pharmaceutical products and active pharmaceutical ingredients (API) products. The finished pharmaceutical products segment manufactures, markets and distributes enoxaparin, Cortrosyn, Amphadase, naloxone, lidocaine jelly, as well as various other critical and non-critical care drugs. The API segment manufactures and distributes recombinant human insulin and porcine insulin. The Company also manufactures and sells insulin API. As of December 31, 2016, the Company manufactured and sold 19 products. As of December 31, 2016, the Company developed a portfolio of 15 generic abbreviated new drug applications (ANDAs) three generic biosimilar product candidates and six injectable and inhalation product candidates.

Taro Pharmaceutical Industries Company Profile

Taro Pharmaceutical Industries Ltd. (Taro) is a science-based pharmaceutical company. The Company operates principally through three entities: Taro Pharmaceutical Industries Ltd. (Taro Israel), and two of its subsidiaries, Taro Pharmaceuticals Inc. (Taro Canada) and Taro U.S.A. The Company markets over 200 pharmaceutical products in over 25 countries. The Company’s owned product brands include Rokacet, with generic names, such as acetaminophen, codeine and caffeine; Topicort, with the generic name, desoximetasone; Etopan, with the generic name etodolac, and Ovide, with the generic name, malathion, among others. The Company’s other generic products include acetazolamide, adapalene, alclometasone dipropionate, amiodarone hydrochloride, ammonium lactate, augmented betamethasone dipropionate, cetirizine hydrochloride, clobetasol propionate, clomipramine hydrochloride, clorazepate dipotassium, fluorouracil, ketoconazole, metronidazole, mupirocin and warfarin sodium, among others.

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