Incyte (NASDAQ: INCY) and Biohaven Pharmaceutical (NYSE:BHVN) are both healthcare companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, dividends and valuation.

Profitability

This table compares Incyte and Biohaven Pharmaceutical’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Incyte -10.90% -12.91% -7.41%
Biohaven Pharmaceutical N/A N/A N/A

Institutional & Insider Ownership

90.0% of Incyte shares are held by institutional investors. Comparatively, 48.1% of Biohaven Pharmaceutical shares are held by institutional investors. 17.7% of Incyte shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Incyte and Biohaven Pharmaceutical, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Incyte 0 5 17 0 2.77
Biohaven Pharmaceutical 0 0 6 0 3.00

Incyte presently has a consensus price target of $143.00, suggesting a potential upside of 63.39%. Biohaven Pharmaceutical has a consensus price target of $38.00, suggesting a potential upside of 24.39%. Given Incyte’s higher possible upside, equities research analysts clearly believe Incyte is more favorable than Biohaven Pharmaceutical.

Earnings & Valuation

This table compares Incyte and Biohaven Pharmaceutical’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Incyte $1.11 billion 16.70 $104.22 million ($0.80) -109.40
Biohaven Pharmaceutical N/A N/A -$63.67 million ($5.22) -5.85

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

Summary

Incyte beats Biohaven Pharmaceutical on 7 of the 12 factors compared between the two stocks.

About Incyte

Incyte Corporation is a biopharmaceutical company focused on the discovery, development and commercialization of therapeutics. Its portfolio includes compounds in various stages, ranging from preclinical to late-stage development, and commercialized products, such as JAKAFI (ruxolitinib) and ICLUSIG (ponatinib). JAKAFI (ruxolitinib) is indicated for the treatment of patients with intermediate or high risk myelofibrosis (MF) and for the treatment of patients with polycythemia vera (PV) having had an inadequate response to or are intolerant of hydroxyurea. As of December 31, 2016, the Food and Drug Administration had granted JAKAFI orphan drug status for MF, PV and essential thrombocythemia. The primary target for ICLUSIG is B Cell Receptor-ABL, an abnormal tyrosine kinase that is expressed in chronic myeloid leukemia and Philadelphia-chromosome positive acute lymphoblastic leukemia. The Company also has a portfolio of selective janus associated kinases 1 (JAK1) inhibitors.

About Biohaven Pharmaceutical

Biohaven Pharmaceutical Holding Company Ltd. is a United States-based biopharmaceutical company. The Company is engaged in the identification and development of clinical-stage compounds targeting orphan neurologic indications and other neurological pathways. It has a portfolio of multiple late-stage drug candidates. Its pipeline includes BHV-0223, which is a formulation of a glutamate-modulating agent; BHV-4157, which is a new chemical entity (NCE) that modulates glutamate, and BHV-5000, which is an in-licensed investigational agent of the Company targeting N-Methyl-D-Aspartate (NMDA) receptor antagonism. Its clinical compound, trigriluzole, is indicated for neurodegenerative diseases and cancer indications, among others. Its pipeline also includes BHV-3000 and BHV-3500, which are in-licensed by the Company for a neurologic indication. It focuses on advancing other mechanistic approaches in orphan and neuroscience indications, and is exploring licenses for additional compounds.

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