Reviewing Amgen (NASDAQ:AMGN) & Revolution Medicines (NASDAQ:RVMD)

Amgen (NASDAQ:AMGN) and Revolution Medicines (NASDAQ:RVMD) are both medical companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.

Valuation and Earnings

This table compares Amgen and Revolution Medicines’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Amgen	$28.19 billion	6.36	$6.72 billion	$7.00	47.71
Revolution Medicines	$4.57 million	1,589.88	-$436.37 million	($3.75)	-11.73

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

Insider and Institutional Ownership

76.5% of Amgen shares are held by institutional investors. Comparatively, 94.3% of Revolution Medicines shares are held by institutional investors. 0.7% of Amgen shares are held by insiders. Comparatively, 8.0% of Revolution Medicines shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Amgen and Revolution Medicines, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amgen	0	10	11	0	2.52
Revolution Medicines	0	0	11	1	3.08

Amgen presently has a consensus target price of $312.63, suggesting a potential downside of 6.39%. Revolution Medicines has a consensus target price of $50.67, suggesting a potential upside of 15.15%. Given Revolution Medicines’ stronger consensus rating and higher possible upside, analysts plainly believe Revolution Medicines is more favorable than Amgen.

Profitability

This table compares Amgen and Revolution Medicines’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Amgen	12.74%	156.21%	10.82%
Revolution Medicines	N/A	-36.41%	-32.13%

Volatility and Risk

Amgen has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Revolution Medicines has a beta of 1.44, suggesting that its stock price is 44% more volatile than the S&P 500.

About Amgen

Amgen Inc. discovers, develops, manufactures, and delivers human therapeutics worldwide. The company's principal products include Enbrel to treat plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis; Otezla for the treatment of adult patients with plaque psoriasis, psoriatic arthritis, and oral ulcers associated with Behçet's disease; Prolia to treat postmenopausal women with osteoporosis; XGEVA for skeletal-related events prevention; Repatha, which reduces the risks of myocardial infarction, stroke, and coronary revascularization; Nplate for the treatment of patients with immune thrombocytopenia; KYPROLIS to treat patients with relapsed or refractory multiple myeloma; Aranesp to treat a lower-than-normal number of red blood cells and anemia; EVENITY for the treatment of osteoporosis in postmenopausal for men and women; Vectibix to treat patients with wild-type RAS metastatic colorectal cancer; BLINCYTO for the treatment of patients with acute lymphoblastic leukemia; TEPEZZA to treat thyroid eye disease; and KRYSTEXXA for the treatment of chronic refractory gout. It also markets other products, including Neulasta, MVASI, AMJEVITA/AMGEVITA, TEZSPIRE, Parsabiv, Aimovig, LUMAKRAS/LUMYKRAS, EPOGEN, KANJINTI, TAVNEOS, RAVICTI, UPLIZNA and PROCYSBI. The company serves healthcare providers, including physicians or their clinics, dialysis centers, hospitals, and pharmacies. It distributes its products through pharmaceutical wholesale distributors, as well as direct-to-consumer channels. The company has collaboration agreements with AstraZeneca plc for the development and commercialization of TEZSPIRE; Novartis Pharma AG to develop and commercialize Aimovig; UCB for the development and commercialization of EVENITY; Kyowa Kirin Co., Ltd. for rocatinlimab development and commercialization; and BeiGene, Ltd. for oncology products expansion and development. Amgen Inc. was incorporated in 1980 and is headquartered in Thousand Oaks, California.

About Revolution Medicines

Revolution Medicines, Inc., a clinical-stage precision oncology company, develops novel targeted therapies for RAS-addicted cancers. The company's research and development pipeline comprises RAS(ON) inhibitors designed to be used as monotherapy in combination with other RAS(ON) inhibitors and/or in combination with RAS companion inhibitors or other therapeutic agents, and RAS companion inhibitors for combination treatment strategies. Its RAS(ON) inhibitors include RMC-6236 (multi), RMC-6291 (G12C), and RMC-9805 (G12D), which are in phase 1 clinical trial; and development candidates comprise RMC-5127 (G12V), RMC-0708 (Q61H), and RMC-8839 (G13C), as well as programs focused on G12R and other targets. The company's RAS companion inhibitors include RMC-4630 that is in phase 2 clinical trial; and RMC-5552, which is in phase 1 clinical trial. Revolution Medicines, Inc. was incorporated in 2014 and is headquartered in Redwood City, California.