Dougherty’s Pharmacy (OTCMKTS:MYDP) and Diplomat Pharmacy (NYSE:DPLO) are both small-cap medical companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, institutional ownership and risk.

Risk and Volatility

Dougherty’s Pharmacy has a beta of -0.58, suggesting that its share price is 158% less volatile than the S&P 500. Comparatively, Diplomat Pharmacy has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Institutional and Insider Ownership

0.5% of Dougherty’s Pharmacy shares are held by institutional investors. Comparatively, 83.6% of Diplomat Pharmacy shares are held by institutional investors. 27.3% of Dougherty’s Pharmacy shares are held by insiders. Comparatively, 24.7% of Diplomat Pharmacy shares are held 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Dougherty’s Pharmacy and Diplomat Pharmacy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dougherty’s Pharmacy 0 0 0 0 N/A
Diplomat Pharmacy 1 4 6 0 2.45

Diplomat Pharmacy has a consensus target price of $24.50, indicating a potential upside of 68.27%. Given Diplomat Pharmacy’s higher possible upside, analysts plainly believe Diplomat Pharmacy is more favorable than Dougherty’s Pharmacy.

Earnings & Valuation

This table compares Dougherty’s Pharmacy and Diplomat Pharmacy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Dougherty’s Pharmacy $40.21 million 0.02 -$2.10 million N/A N/A
Diplomat Pharmacy $4.49 billion 0.24 $15.51 million $0.84 17.33

Diplomat Pharmacy has higher revenue and earnings than Dougherty’s Pharmacy.

Profitability

This table compares Dougherty’s Pharmacy and Diplomat Pharmacy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dougherty’s Pharmacy -6.05% -79.29% -10.64%
Diplomat Pharmacy 0.04% 5.31% 2.17%

Summary

Diplomat Pharmacy beats Dougherty’s Pharmacy on 10 of the 11 factors compared between the two stocks.

About Dougherty’s Pharmacy

Dougherty's Pharmacy, Inc., an investment firm, focuses on acquiring, managing, and growing community based pharmacies in the Southwest Region of the United States. Its flagship store is Dougherty's Pharmacy, a turn-key multi-service pharmacy located in Dallas, Texas. The company was formerly known as Ascendant Solutions, Inc. and changed its name to Dougherty's Pharmacy, Inc. in May 2017. Dougherty's Pharmacy, Inc. was founded in 1998 and is based in Dallas, Texas.

About Diplomat Pharmacy

Diplomat Pharmacy, Inc. operates as an independent specialty pharmacy in the United States. The company stocks, dispenses, and distributes prescriptions for various biotechnology and specialty pharmaceutical manufacturers. It also provides specialty infusion pharmacy, patient care coordination, clinical, compliance and persistency program, patient financial assistance, specialty pharmacy training/consulting, benefits investigation, prior authorization, risk evaluation and medication strategy, retail specialty, and hub services, as well as clinical and administrative support services to hospitals and health systems. The company's primary focus is on medication management programs for individuals with complex chronic diseases, including oncology, immunology, hepatitis, multiple sclerosis, specialized infusion therapy, and various other serious or long-term conditions. The company was founded in 1975 and is headquartered in Flint, Michigan.

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