Top 10 General Drug Manufacturers Stocks
Marvin ranks 10 general drug manufacturers by Overall score. Eli Lilly, Bristol-Myers Squibb and Amgen sit at the top. Each score compares a company only with others in its industry.
General drug manufacturers are large companies that develop, make and sell prescription medicines, often across many disease areas. Their results often depend on a few major products and on how long they keep selling them. This list shows the ten companies in this industry that Marvin's rules ranked highest today.
Look beyond the Overall score. Quality describes the strength of the business, while Opportunity is a separate score, and the two can point in different directions. Johnson & Johnson, for example, has a much higher Quality score than Opportunity score.
Also keep in mind that some figures are missing for some companies, and a few companies carry a lot of debt. A high rank here says how a company compares with its industry peers today. It is not a recommendation or a forecast.
The list
How Marvin ranked these stocks
Marvin included companies above about three hundred million dollars in size in the Drug Manufacturers - General industry and ranked them by Overall score, highest first. Scores run from zero to one hundred and are relative to each company's own industry. A high score means a company looks strong next to other drug makers, not next to every stock in the market.
Companies above about $300 million in size, ranked by Marvin scores (0-100, relative to each company's own industry). The Drug Manufacturers - General industry, highest Overall score first.
The stocks, one by one
Eli Lilly and Company LLY
Eli Lilly has the top Overall score, 93, in the group. Revenue grew 44.7% last fiscal year, gross margin is 83.4%, and return on equity is 78.8%. Caution: debt-to-equity of 1.62 shows moderate borrowing, and operating margin is not available.
Bristol-Myers Squibb Company BMY
Bristol-Myers Squibb scores 85 overall, but its Quality score is only 63. Free cash flow margin is 23.3% and gross margin is 70.2%, both solid. Caution: revenue growth was -0.2%, so sales were roughly flat, and debt-to-equity is 2.05.
Amgen Inc. AMGN
Amgen shows strong profitability, with an operating margin of 30.0%, a free cash flow margin of 26.7% and return on equity of 74.8%. Revenue grew 10.0%, a modest pace. Caution: debt-to-equity of 4.90 is high, so borrowing is a real consideration.
Johnson & Johnson JNJ
Johnson & Johnson has a Quality score of 86 and low debt, with debt-to-equity of 0.58. Free cash flow margin is 22.7%, and revenue grew 6.0%. Caution: its Opportunity score is only 53, and growth is modest.
AbbVie Inc. ABBV
AbbVie turns a good share of sales into profit, with an operating margin of 26.2% and a free cash flow margin of 28.3%. Revenue grew 8.6%. Caution: return on equity and debt-to-equity are not available, so its financial strength is harder to judge.
Merck & Co., Inc. MRK
Merck has a gross margin of 73.0% and a free cash flow margin of 24.1%, both healthy. Caution: revenue grew only 1.3%, return on equity is a low 7.6%, and its Opportunity score is just 23.
Gilead Sciences, Inc. GILD
Gilead has a very high free cash flow margin of 42.5% and a gross margin of 79.6%. Caution: operating margin is negative at -8.2%, return on equity is -27.4%, and its Quality score is only 39, so the profit picture is mixed.
Pfizer Inc. PFE
Pfizer has a gross margin of 73.2% and a free cash flow margin of 17.2%, with debt-to-equity of 0.74. Caution: revenue growth was -1.6%, so sales slipped, and return on equity is only 5.1%.
Organon & Co. OGN
Organon has a free cash flow margin of 9.3% and return on equity of 20.8%. Caution: debt-to-equity is very high at 8.50, gross margin of 52.7% is lower than most peers here, and revenue growth was -2.9%.
Biogen Inc. BIIB
Biogen has the lowest debt in the group, with debt-to-equity of 0.35, and a free cash flow margin of 24.4%. Caution: return on equity is only 7.4%, revenue grew 2.2%, and its Opportunity score is just 7.
Common questions
What does a general drug manufacturer do?
These companies research, develop, make and sell prescription medicines, usually across several therapy areas. They tend to be large, and their results often depend on a handful of major products.
Why do some companies on this list have high debt?
Drug makers sometimes borrow to fund acquisitions, research or other large costs. The debt-to-equity ratio shows how much a company owes compared with its shareholders' stake, so a higher number means more borrowing.
Does a higher Marvin score mean a stock is a better investment?
No. Scores describe how a company compares with other drug makers today, based on its financial figures. They are not predictions or advice, so read the strengths and cautions for each company before drawing conclusions.
Keep reading
- Top 15 Fastest-Growing Profitable Healthcare Stocks
- Top 15 Healthcare Stocks by Marvin Opportunity Score
- Top 15 Healthcare Companies With the Strongest Businesses
- Top 15 Healthcare Stocks Right Now, Ranked by Marvin Scores
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Marvin's scores (0-100) compare each company with others in its industry today. Growth and margin figures come from SEC filings. This is general information, not personal investment advice or a recommendation to buy or sell anything. Do your own research.