AMAG Pharmaceuticals (NASDAQ: AMAG) and Shire PLC (NASDAQ:SHPG) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their profitabiliy, valuation, earnings, analyst recommendations, dividends, institutional ownership and risk.
Profitability
This table compares AMAG Pharmaceuticals and Shire PLC’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| AMAG Pharmaceuticals | -5.61% | 1.69% | 0.63% |
| Shire PLC | 2.14% | 13.05% | 5.64% |
Earnings & Valuation
This table compares AMAG Pharmaceuticals and Shire PLC’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| AMAG Pharmaceuticals | $562.26 million | 1.25 | $246.86 million | ($0.96) | -20.94 |
| Shire PLC | $13.26 billion | N/A | $5.31 billion | $0.74 | 210.69 |
Shire PLC has higher revenue and earnings than AMAG Pharmaceuticals. AMAG Pharmaceuticals is trading at a lower price-to-earnings ratio than Shire PLC, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
21.1% of Shire PLC shares are owned by institutional investors. 3.8% of AMAG Pharmaceuticals shares are owned by insiders. Comparatively, 2.0% of Shire PLC shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Analyst Ratings
This is a summary of recent ratings for AMAG Pharmaceuticals and Shire PLC, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| AMAG Pharmaceuticals | 1 | 9 | 2 | 0 | 2.08 |
| Shire PLC | 0 | 5 | 15 | 0 | 2.75 |
AMAG Pharmaceuticals presently has a consensus price target of $28.70, suggesting a potential upside of 42.79%. Shire PLC has a consensus price target of $224.40, suggesting a potential upside of 43.93%. Given Shire PLC’s stronger consensus rating and higher possible upside, analysts clearly believe Shire PLC is more favorable than AMAG Pharmaceuticals.
Volatility and Risk
AMAG Pharmaceuticals has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500. Comparatively, Shire PLC has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500.
Dividends
Shire PLC pays an annual dividend of $0.91 per share and has a dividend yield of 0.6%. AMAG Pharmaceuticals does not pay a dividend. Shire PLC pays out 123.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Summary
Shire PLC beats AMAG Pharmaceuticals on 12 of the 14 factors compared between the two stocks.
About AMAG Pharmaceuticals
AMAG Pharmaceuticals, Inc. is a pharmaceutical company. The Company’s segment is the manufacture, development and commercialization of products and services for use in treating various conditions, with a focus on maternal health, anemia management and cancer supportive care. Its offerings focus on maternal health, anemia management and cancer supportive care, including its product, Makena (hydroxyprogesterone caproate injection); services related to the collection, processing and storage of umbilical cord blood stem cell and cord tissue units operated through Cord Blood Registry (CBR); its product, Feraheme (ferumoxytol), for intravenous (IV) use, and MuGard Mucoadhesive Oral Wound Rinse. It is engaged in the development of Digoxin immune fab, a polyclonal antibody for the treatment of severe preeclampsia in pregnant women. Makena is a drug indicated to reduce the risk of preterm birth in women pregnant with a single baby having a history of singleton spontaneous preterm birth.
About Shire PLC
Shire plc is a biotech company focused on serving people with rare diseases and other specialized conditions. The Company’s segment is engaged in research, development, licensing, manufacturing, marketing, distribution and sale of specialist medicines. It focuses its development resources on projects in various therapeutic areas (TAs), including Neuroscience, Ophthalmology, Hematology, Oncology, Immunology, Gastrointestinal (GI)/Metabolic/Endocrinology Diseases. Its Hematology products include ADVATE (Antihemophilic Factor (Recombinant)), ADYNOVATE/ADYNOVI (Antihemophilic Factor (Recombinant), PEGylated)), RIXUBIS (Coagulation Factor IX (Recombinant)), VONVENDI (von Willebrand factor (Recombinant)) and FEIBA (Anti-Inhibitor Coagulant Complex). Its Genetic Diseases products include CINRYZE (C1 esterase inhibitor (human)), FIRAZYR (icatibant), ELAPRASE (idursulfase), REPLAGAL (agalsidase alfa) and VPRIV (velaglucerase alfa).
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