Amgen vs GSK Which Is More Favorable?

Amgen and GSK are two leading pharmaceutical companies with a significant presence in the biotech industry. Both companies have a strong track record of developing and commercializing innovative drugs and therapies. Amgen is known for its expertise in biotechnology, while GSK is recognized for its diverse portfolio of pharmaceutical products. Investors often compare the performance of these two stocks to make informed decisions about their investment portfolios. Understanding the strengths and weaknesses of each company can help investors make sound investment choices.

Amgen or GSK?

When comparing Amgen and GSK, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Amgen and GSK.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Amgen has a dividend yield of 3.26%, while GSK has a dividend yield of 4.42%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Amgen reports a 5-year dividend growth of 10.04% year and a payout ratio of 112.70%. On the other hand, GSK reports a 5-year dividend growth of -4.37% year and a payout ratio of 95.58%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Amgen P/E ratio at 35.01 and GSK's P/E ratio at 22.39. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Amgen P/B ratio is 19.67 while GSK's P/B ratio is 4.01.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Amgen has seen a 5-year revenue growth of 0.47%, while GSK's is -0.53%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Amgen's ROE at 68.49% and GSK's ROE at 18.08%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $272.36 for Amgen and $35.18 for GSK. Over the past year, Amgen's prices ranged from $257.80 to $346.85, with a yearly change of 34.54%. GSK's prices fluctuated between $32.83 and $45.93, with a yearly change of 39.90%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.