Head-To-Head Analysis: Lifevantage (NASDAQ:LFVN) and McKesson (NYSE:MCK)

McKesson (NYSE:MCK) and Lifevantage (NASDAQ:LFVN) are both medical companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, valuation, earnings, analyst recommendations, institutional ownership and profitability.

Valuation and Earnings

This table compares McKesson and Lifevantage”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
McKesson	$359.05 billion	0.24	$3.30 billion	$25.83	27.04
Lifevantage	$200.16 million	0.79	$2.94 million	$0.69	18.23

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

Profitability

This table compares McKesson and Lifevantage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
McKesson	0.92%	-201.12%	5.83%
Lifevantage	4.12%	34.67%	15.24%

Dividends

McKesson pays an annual dividend of $2.84 per share and has a dividend yield of 0.4%. Lifevantage pays an annual dividend of $0.18 per share and has a dividend yield of 1.4%. McKesson pays out 11.0% of its earnings in the form of a dividend. Lifevantage pays out 26.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. McKesson has increased its dividend for 17 consecutive years and Lifevantage has increased its dividend for 3 consecutive years.

Institutional and Insider Ownership

85.1% of McKesson shares are held by institutional investors. Comparatively, 35.3% of Lifevantage shares are held by institutional investors. 0.1% of McKesson shares are held by company insiders. Comparatively, 20.7% of Lifevantage shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

McKesson has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500. Comparatively, Lifevantage has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for McKesson and Lifevantage, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
McKesson	0	3	10	1	2.86
Lifevantage	0	0	2	0	3.00

McKesson presently has a consensus target price of $710.17, indicating a potential upside of 1.68%. Lifevantage has a consensus target price of $30.50, indicating a potential upside of 142.45%. Given Lifevantage’s stronger consensus rating and higher probable upside, analysts plainly believe Lifevantage is more favorable than McKesson.

Summary

McKesson beats Lifevantage on 10 of the 18 factors compared between the two stocks.

About McKesson

McKesson Corporation provides healthcare services in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International. The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter pharmaceutical drugs, and other healthcare-related products. This segment also offers practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices; and consulting, outsourcing, technological, and other services, as well as sells financial, operational, and clinical solutions to pharmacies. The RxTS segment serves biopharma and life sciences partners, and patients to address medication challenges for patients by working across healthcare; connects patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to deliver innovative solutions to help people get the medicine needed to live healthier lives; and provides prescription price transparency, benefit insight, dispensing support, third-party logistics, and wholesale distribution support services. The Medical-Surgical Solutions segment offers medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. The International segment provides distribution and services to wholesale, institutional, and retail customers in Europe and Canada. McKesson Corporation was founded in 1833 and is headquartered in Irving, Texas.

About Lifevantage

LifeVantage Corporation engages in the identification, research, development, formulation, and sale of advanced nutrigenomic activators, dietary supplements, nootropics, pre- and pro-biotics, weight management, skin and hair care, bath and body, and targeted relief products. It offers Protandim, a dietary supplement; LifeVantage Omega+, a dietary supplement that combines DHA and EPA Omega-3 fatty acids, Omega-7 fatty acids, and vitamin D3; LifeVantage ProBio, a dietary supplement to support gut health; PhysIQ, a weight management system; LifeVantage IC Bright, a supplement to support eye and brain health, reduce eye fatigue and strain, supports cognitive functions, and support normal sleep patterns; Petandim for Dogs, a supplement to combat oxidative stress in dogs; and Axio, a nootropic energy drink mix. The company also provides anti-aging skin care products, including liquid collagen, facial cleansers, perfecting lotions, eye serums, anti-aging creams, hand creams, beauty serum, as well as hair care products, such as invigorating shampoos, nourishing conditioners, and scalp serums under the LifeVantage TrueScience brand name. In addition, it offers bath and body, and targeted relief products, such as body lotion, body wash, body butter, deodorant, soothing balm, and body rub under the TrueScience brand name. It sells its products through its website and network of independent distributors in the United States, Mexico, Japan, Australia, Hong Kong, Canada, Thailand, the United Kingdom, the Netherlands, Germany, Taiwan, Austria, Spain, Ireland, Belgium, New Zealand, Singapore, and the Philippines. The company was founded in 2003 and is headquartered in Lehi, Utah.