Financial Comparison: Check-Cap (CHEK) versus AbbVie (ABBV)

Check-Cap (NASDAQ: CHEK) and AbbVie (NYSE:ABBV) are both medical companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Dividends

AbbVie pays an annual dividend of $2.56 per share and has a dividend yield of 2.9%. Check-Cap does not pay a dividend. AbbVie pays out 62.9% of its earnings in the form of a dividend. AbbVie has raised its dividend for 44 consecutive years.

Risk and Volatility

Check-Cap has a beta of -0.37, indicating that its stock price is 137% less volatile than the S&P 500. Comparatively, AbbVie has a beta of 1.48, indicating that its stock price is 48% more volatile than the S&P 500.

Earnings and Valuation

This table compares Check-Cap and AbbVie’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Check-Cap N/A N/A -$9.62 million ($0.59) -3.00
AbbVie $26.71 billion 5.21 $11.57 billion $4.07 21.47

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

Profitability

This table compares Check-Cap and AbbVie’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Check-Cap N/A -98.88% -80.97%
AbbVie 24.77% 150.27% 12.52%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Check-Cap and AbbVie, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Check-Cap 0 0 3 0 3.00
AbbVie 0 6 7 0 2.54

Check-Cap currently has a consensus target price of $6.00, indicating a potential upside of 238.98%. AbbVie has a consensus target price of $83.75, indicating a potential downside of 4.14%. Given Check-Cap’s stronger consensus rating and higher possible upside, analysts clearly believe Check-Cap is more favorable than AbbVie.

Insider and Institutional Ownership

19.3% of Check-Cap shares are owned by institutional investors. Comparatively, 68.3% of AbbVie shares are owned by institutional investors. 0.2% of AbbVie shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

AbbVie beats Check-Cap on 12 of the 15 factors compared between the two stocks.

About Check-Cap

Check-Cap Ltd. (Check-Cap) is a clinical-stage medical diagnostics company. The Company is engaged in the development of an ingestible imaging capsule that utilizes low-dose X-rays for the detection and imaging of colonic polyps and colorectal cancers, or CRC. The Company’s system consists of main components, such as ingestible scanning capsule; Capsule Positioning System (CPS), a recorder worn on the patient’s back, and a personal computer (PC)-based work station for data reconstruction and image processing. The Company’s scanning capsule will be swallowed and propelled by natural motility through the gastrointestinal tract and excreted naturally with no need for retrieval for data collection. Its scanning capsule employs low-dose X-rays, which allow the system to image the interior lining of the colon even when surrounded by intestinal content. Its capsule transmits information to a receiving device worn on the patient’s body that stores the information for off-line analysis.

About AbbVie

AbbVie Inc. (AbbVie) is a research-based biopharmaceutical company. The Company is engaged in the discovery, development, manufacture and sale of a range of pharmaceutical products. Its products are focused on treating conditions, such as chronic autoimmune diseases in rheumatology, gastroenterology and dermatology; oncology, including blood cancers; virology, including hepatitis C virus (HCV) and human immunodeficiency virus (HIV); neurological disorders, such as Parkinson’s disease and multiple sclerosis; metabolic diseases, including thyroid disease and complications associated with cystic fibrosis, and other serious health conditions. It offers products in various categories, including HUMIRA (adalimumab), Oncology products, Virology Products, Additional Virology products, Metabolics/Hormones products, Endocrinology products and other products, which include Duopa and Duodopa (carbidopa and levodopa), Anesthesia products and ZINBRYTA (daclizumab).

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