Mallinckrodt PLC (MNK) and Salix Pharmaceuticals (SLXP) Critical Review

Mallinckrodt PLC (NYSE: MNK) and Salix Pharmaceuticals (NASDAQ:SLXP) are both medical companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, institutional ownership, earnings and valuation.

Valuation and Earnings

This table compares Mallinckrodt PLC and Salix Pharmaceuticals’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Mallinckrodt PLC $3.27 billion 1.07 $666.60 million $4.10 8.62
Salix Pharmaceuticals N/A N/A N/A N/A N/A

Mallinckrodt PLC has higher revenue and earnings than Salix Pharmaceuticals.

Institutional and Insider Ownership

97.5% of Mallinckrodt PLC shares are held by institutional investors. 0.8% of Mallinckrodt PLC shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Mallinckrodt PLC and Salix Pharmaceuticals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mallinckrodt PLC 12.64% 15.28% 5.20%
Salix Pharmaceuticals -2,134.34% -305.24% -25.83%

Analyst Ratings

This is a summary of recent recommendations and price targets for Mallinckrodt PLC and Salix Pharmaceuticals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mallinckrodt PLC 0 2 13 0 2.87
Salix Pharmaceuticals 0 0 0 0 N/A

Mallinckrodt PLC presently has a consensus price target of $69.83, indicating a potential upside of 97.66%. Given Mallinckrodt PLC’s higher possible upside, equities analysts clearly believe Mallinckrodt PLC is more favorable than Salix Pharmaceuticals.

Summary

Mallinckrodt PLC beats Salix Pharmaceuticals on 8 of the 8 factors compared between the two stocks.

Mallinckrodt PLC Company Profile

Mallinckrodt public limited company develops, manufactures, markets and distributes branded and generic specialty pharmaceutical products and therapies. The Company focuses on various therapeutic areas, such as autoimmune and rare disease specialty areas, including neurology, rheumatology, nephrology, ophthalmology and pulmonology; immunotherapy and neonatal critical care respiratory therapies; analgesics and hemostasis products, and central nervous system drugs. Its segments include Specialty Brands and Specialty Generics. The Specialty Brands segment produces and markets branded pharmaceutical products and therapies. The Specialty Generics segment produces and markets specialty generic pharmaceuticals and active pharmaceutical ingredient (API) consisting of biologics, medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients. Its product portfolio includes Acthar, Inomax, Ofirmev, Therakos immunotherapy, Hemostasis products and StrataGraft.

Salix Pharmaceuticals Company Profile

Salix Pharmaceuticals, Ltd. is a specialty pharmaceutical company engaged in acquiring, developing and commercializing prescription drugs and medical devices used in the treatment of a variety of gastrointestinal disorders. The Company offers over 20 marketed products, such as XIFAXAN550 (rifaximin) tablets, XIFAXAN (rifaximin) tablets, APRISO (mesalamine) extended-release capsules, UCERIS (budesonide MMX) extended release tablets, MOVIPREP, GLUMETZA extended release tablets, RELISTOR subcutaneous injection, UCERIS rectal foam, OSMOPREP tablets, SOLESTA, DEFLUX, FULYZAQ (crofelemer) delayed-release tablets, GIAZO (balsalazide disodium) tablets, CYCLOSET (bromocriptine mesylate) tablets, and FENOGLIDE (fenofibrate) tablets, among others. Its primary product candidates under development include Rifaximin, Methylnaltrexone bromide oral, Ruconest, Rifaximin delayed release or extended intestinal release and Rifaximin soluble solid dispersion (SSD)/next generation.

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