Patheon (NYSE: PTHN) is one of 103 public companies in the “Pharmaceuticals” industry, but how does it contrast to its peers? We will compare Patheon to related businesses based on the strength of its earnings, institutional ownership, analyst recommendations, profitability, valuation, risk and dividends.

Valuation & Earnings

This table compares Patheon and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Patheon $1.87 billion $31.70 million 46.64
Patheon Competitors $8.17 billion $1.09 billion 153.56

Patheon’s peers have higher revenue and earnings than Patheon. Patheon is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Patheon and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Patheon 0 6 1 0 2.14
Patheon Competitors 883 3836 6752 181 2.53

Patheon presently has a consensus price target of $33.60, suggesting a potential downside of 3.95%. As a group, “Pharmaceuticals” companies have a potential upside of 19.69%. Given Patheon’s peers stronger consensus rating and higher possible upside, analysts clearly believe Patheon has less favorable growth aspects than its peers.

Profitability

This table compares Patheon and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Patheon 5.63% -35.93% 4.18%
Patheon Competitors -2,435.36% -69.00% -7.03%

Insider and Institutional Ownership

0.6% of Patheon shares are held by institutional investors. Comparatively, 44.5% of shares of all “Pharmaceuticals” companies are held by institutional investors. 0.1% of Patheon shares are held by company insiders. Comparatively, 11.4% of shares of all “Pharmaceuticals” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Patheon has a beta of 2.69, meaning that its share price is 169% more volatile than the S&P 500. Comparatively, Patheon’s peers have a beta of 34.19, meaning that their average share price is 3,319% more volatile than the S&P 500.

Summary

Patheon peers beat Patheon on 10 of the 13 factors compared.

About Patheon

Patheon N.V. is a provider of outsourced pharmaceutical development and manufacturing services. The Company’s segments include Drug Product Services (DPS), Pharmaceutical Development Services (PDS) and Drug Substance Services (DSS). The DPS segment is engaged in manufacturing and packaging for approved prescription, over-the-counter (OTC) and nutritional products. The PDS segment provides a range of formulation, production and technical services from the early stages of a product’s development to regulatory approval, as well as for new formulations of approved products for lifecycle extension. The DSS segment provides small molecule active pharmaceutical ingredient (API) and outsourced manufacturing solutions for large molecule biological API from early development through commercial scale production. It provides an integrated range of API and finished drug product services to its customers, from formulation development to clinical and commercial-scale manufacturing.

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