Dr. Reddy’s Laboratories (NYSE:RDY – Get Free Report) and ARS Pharmaceuticals (NASDAQ:SPRY – Get Free Report) are both healthcare companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, valuation, analyst recommendations, risk, institutional ownership and dividends.
Earnings & Valuation
This table compares Dr. Reddy’s Laboratories and ARS Pharmaceuticals”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Dr. Reddy’s Laboratories | $3.58 billion | 3.10 | $456.00 million | $0.44 | 30.19 |
| ARS Pharmaceuticals | $84.28 million | 5.04 | -$171.30 million | ($2.18) | -1.96 |
Dr. Reddy’s Laboratories has higher revenue and earnings than ARS Pharmaceuticals. ARS Pharmaceuticals is trading at a lower price-to-earnings ratio than Dr. Reddy’s Laboratories, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Dr. Reddy’s Laboratories has a beta of 0.29, meaning that its stock price is 71% less volatile than the S&P 500. Comparatively, ARS Pharmaceuticals has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500.
Profitability
This table compares Dr. Reddy’s Laboratories and ARS Pharmaceuticals’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Dr. Reddy’s Laboratories | 10.15% | 9.49% | 6.32% |
| ARS Pharmaceuticals | -184.24% | -256.67% | -69.63% |
Institutional and Insider Ownership
3.8% of Dr. Reddy’s Laboratories shares are owned by institutional investors. Comparatively, 68.2% of ARS Pharmaceuticals shares are owned by institutional investors. 2.0% of Dr. Reddy’s Laboratories shares are owned by insiders. Comparatively, 33.8% of ARS Pharmaceuticals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings for Dr. Reddy’s Laboratories and ARS Pharmaceuticals, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Dr. Reddy’s Laboratories | 1 | 1 | 2 | 0 | 2.25 |
| ARS Pharmaceuticals | 1 | 1 | 4 | 0 | 2.50 |
Dr. Reddy’s Laboratories currently has a consensus price target of $732.40, suggesting a potential upside of 5,412.98%. ARS Pharmaceuticals has a consensus price target of $25.00, suggesting a potential upside of 485.48%. Given Dr. Reddy’s Laboratories’ higher possible upside, equities research analysts plainly believe Dr. Reddy’s Laboratories is more favorable than ARS Pharmaceuticals.
Summary
Dr. Reddy’s Laboratories beats ARS Pharmaceuticals on 8 of the 14 factors compared between the two stocks.
About Dr. Reddy’s Laboratories
Dr. Reddy’s Laboratories Limited, together with its subsidiaries, operates as an integrated pharmaceutical company worldwide. It operates through Global Generics, Pharmaceutical Services and Active Ingredients (PSAI), and Others segments. The company’s Global Generics segment manufactures and markets prescription and over-the-counter finished pharmaceutical products that are marketed under a brand name or as a generic finished dosages with therapeutic equivalence to branded formulations, as well as engages in the biologics business. The PSAI segment manufactures and markets active pharmaceutical ingredients and intermediates, which are principal ingredients for finished pharmaceutical products. This segment also provides contract research services; and manufactures and sells active pharmaceutical ingredients and steroids in accordance with the specific customer requirements. The Others segment engages in developing therapies in the fields of oncology and inflammation; research and development of differentiated formulations; and provides digital healthcare and information technology enabled business support services. The company offers its products for various therapeutic categories primarily include gastro-intestinal, cardiovascular, anti-diabetic, dermatology, oncology, respiratory, stomatology, urology, and nephrology. Dr. Reddy’s Laboratories Limited was incorporated in 1984 and is headquartered in Hyderabad, India.
About ARS Pharmaceuticals
ARS Pharmaceuticals, Inc., a biopharmaceutical company, develops treatments for severe allergic reactions. The company is developing neffy, a needle-free and low-dose intranasal epinephrine nasal spray for the emergency treatment of Type I allergic reactions, including anaphylaxis. It serves healthcare professionals, patients, and caregivers. ARS Pharmaceuticals, Inc. was founded in 2015 and is headquartered in San Diego, California.
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