Critical Review: Teva Pharmaceutical Industries (NYSE:TEVA) vs. Harrow (NASDAQ:HROW)

Teva Pharmaceutical Industries (NYSE:TEVA) and Harrow (NASDAQ:HROW) are both healthcare companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, risk and profitability.

Profitability

This table compares Teva Pharmaceutical Industries and Harrow’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Teva Pharmaceutical Industries	4.08%	32.64%	6.34%
Harrow	-13.51%	-38.00%	-3.37%

Earnings and Valuation

This table compares Teva Pharmaceutical Industries and Harrow”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Teva Pharmaceutical Industries	$17.31 billion	2.75	$1.41 billion	$0.60	68.07
Harrow	$272.30 million	3.86	-$5.14 million	($1.00)	-28.07

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

Insider and Institutional Ownership

54.0% of Teva Pharmaceutical Industries shares are owned by institutional investors. Comparatively, 72.8% of Harrow shares are owned by institutional investors. 0.5% of Teva Pharmaceutical Industries shares are owned by insiders. Comparatively, 12.8% of Harrow shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Teva Pharmaceutical Industries has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500. Comparatively, Harrow has a beta of 0.19, meaning that its share price is 81% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Teva Pharmaceutical Industries and Harrow, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Teva Pharmaceutical Industries	0	1	12	0	2.92
Harrow	1	2	7	0	2.60

Teva Pharmaceutical Industries presently has a consensus target price of $45.92, suggesting a potential upside of 12.43%. Harrow has a consensus target price of $66.17, suggesting a potential upside of 135.72%. Given Harrow’s higher probable upside, analysts plainly believe Harrow is more favorable than Teva Pharmaceutical Industries.

Summary

Teva Pharmaceutical Industries beats Harrow on 9 of the 13 factors compared between the two stocks.

About Teva Pharmaceutical Industries

Teva Pharmaceutical Industries Limited develops, manufactures, markets, and distributes generic medicines, specialty medicines, and biopharmaceutical products in North America, Europe, Israel, and internationally. It offers generic medicines in various dosage forms, such as tablets, capsules, injectables, inhalants, liquids, transdermal patches, ointments, and creams; sterile products, hormones, high-potency drugs, and cytotoxic substances in parenteral and solid dosage forms; and generic products with medical devices and combination products. The company focuses on the central nervous system (CNS), respiratory, and oncology areas. It provides active pharmaceutical ingredients, as well as contract manufacturing services; and operates an out-licensing platform that offers a portfolio of products to other pharmaceutical companies. The company also offers BENDEKA and TREANDA injections for the treatment of chronic lymphocytic leukemia and indolent b-cell non-hodgkin’s lymphoma; GRANIX; TRISENOX; LONQUEX; and TEVAGRASTIM/RATIOGRASTIM. In addition, it provides COPAXONE for the treatment of relapsing forms of multiple sclerosis; AJOVY for the preventive treatment of migraine in adults; AUSTEDO for the treatment of neurodegenerative and movement disorders associated with Huntington’s disease and tardive dyskinesia; UZEDY for the treatment of schizophrenia; ProAir RespiClick inhalation powder; QVAR for treatment for asthma; BRALTUS, a long-acting muscarinic antagonist; CINQAIR/CINQAERO injection; DuoResp Spiromax, an inhaled corticosteroid and long-acting beta-agonist bronchodilator; and AirDuo RespiClick fluticasone propionate and salmeterol inhalation powder. The company offers its OTC products under SUDOCREM, NasenDuo, DICLOX FORTE, OLFEN Max, and FLEGAMINA brand names. It has collaboration agreements with MedinCell; Sanofi; Alvotech; and Biolojic Design Ltd., as well as license agreement with MODAG GmbH. The company was founded in 1901 and is based in Tel Aviv, Israel.

About Harrow

Harrow, Inc. operates as an ophthalmic-focused healthcare company. The company owns ImprimisRx, an ophthalmology outsourcing and pharmaceutical compounding business. The company was formerly known as Imprimis Pharmaceuticals, Inc. and changed its name to Harrow Health, Inc. in December 2018. Harrow Health, Inc. was incorporated in 2006 and is headquartered in Nashville, Tennessee.