Analyzing Gilead Sciences (NASDAQ:GILD) and Mesoblast (NASDAQ:MESO)

Gilead Sciences (NASDAQ:GILD) and Mesoblast (NASDAQ:MESO) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, valuation, dividends and risk.

Risk and Volatility

Gilead Sciences has a beta of 0.19, suggesting that its share price is 81% less volatile than the S&P 500. Comparatively, Mesoblast has a beta of 3.6, suggesting that its share price is 260% more volatile than the S&P 500.

Profitability

This table compares Gilead Sciences and Mesoblast’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gilead Sciences	20.89%	38.85%	13.60%
Mesoblast	N/A	N/A	N/A

Institutional and Insider Ownership

83.7% of Gilead Sciences shares are owned by institutional investors. Comparatively, 1.4% of Mesoblast shares are owned by institutional investors. 0.3% of Gilead Sciences shares are owned by insiders. Comparatively, 18.8% of Mesoblast shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Gilead Sciences and Mesoblast’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gilead Sciences	$27.12 billion	3.08	$5.67 billion	$4.50	14.91
Mesoblast	$7.47 million	95.02	-$81.89 million	($1.12)	-5.55

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

Analyst Ratings

This is a summary of current ratings and target prices for Gilead Sciences and Mesoblast, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gilead Sciences	0	10	5	0	2.33
Mesoblast	1	3	2	0	2.17

Gilead Sciences presently has a consensus price target of $84.57, suggesting a potential upside of 26.08%. Mesoblast has a consensus price target of $13.67, suggesting a potential upside of 119.72%. Given Mesoblast’s higher possible upside, analysts plainly believe Mesoblast is more favorable than Gilead Sciences.

Summary

Gilead Sciences beats Mesoblast on 10 of the 14 factors compared between the two stocks.

About Gilead Sciences

Gilead Sciences, Inc., a biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally. The company provides Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, Sunlencs, and Atripla products for the treatment of HIV/AIDS; Veklury, an injection for intravenous use, for the treatment of COVID-19; and Epclusa, Harvoni, Vemlidy, and Viread for the treatment of viral hepatitis. It also offers Yescarta, Tecartus, and Trodelvy products for the treatment of oncology; Letairis, an oral formulation for the treatment of pulmonary arterial hypertension; and AmBisome, a liposomal formulation for the treatment of serious invasive fungal infections. The company has collaboration agreements with Arcus Biosciences, Inc.; Merck Sharp & Dohme Corp.; Pionyr Immunotherapeutics Inc.; Tizona Therapeutics, Inc.; Galapagos NV; Janssen Sciences Ireland Unlimited Company; Japan Tobacco, Inc.; Dragonfly Therapeutics, Inc.; Arcellx, Inc.; Everest Medicines; Merck & Co, Inc.; Tentarix Biotherapeutics Inc.; and Assembly Biosciences, Inc. It also has research collaboration, option, and license agreement with Merus N.V. for the discovery of novel dual tumor-associated antigens (TAA) targeting trispecific antibodies. The company was incorporated in 1987 and is headquartered in Foster City, California.

About Mesoblast

Mesoblast Limited engages in the development of regenerative medicine products in Australia, the United States, Singapore, and Switzerland. The company offers products in the areas of cardiovascular, spine orthopedic disorder, oncology, hematology, and immune-mediated and inflammatory diseases. Its proprietary regenerative medicine technology platform is based on specialized cells known as mesenchymal lineage cells. The company offers Remestemcel-L that is in Phase III clinical trials for the treatment of systemic inflammatory diseases, including steroid refractory acute graft versus host disease, acute respiratory distress syndrome, and biologic refractory inflammatory bowel disease; and Remestemcel-L, which is in Phase III clinical trials to treat chronic heart failure and chronic low back pain due to degenerative disc disease. It is also developing MPC-300-IV to treat biologic refractory rheumatoid arthritis diabetic nephropathy; and MPC-25-IC for the treatment or prevention of acute myocardial infarction. It has strategic partnerships with Tasly Pharmaceutical Group to offer MPC-150-IM for heart failure and MPC-25-IC for heart attacks in China; JCR Pharmaceuticals Co. Ltd. to treat wound healing in patients with epidermolysis bullosa; and Grünenthal to develops and commercializes cell therapy for the treatment of chronic low back pain. The company was incorporated in 2004 and is headquartered in Melbourne, Australia.