China Jo-Jo Drugstores (NASDAQ:CJJD) vs. Diplomat Pharmacy (NASDAQ:DPLO) Critical Review

Diplomat Pharmacy (NYSE:DPLO) and China Jo-Jo Drugstores (NASDAQ:CJJD) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Earnings and Valuation

This table compares Diplomat Pharmacy and China Jo-Jo Drugstores’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Diplomat Pharmacy $5.49 billion 0.08 -$302.27 million $0.20 28.55
China Jo-Jo Drugstores $107.55 million 0.33 -$930,000.00 N/A N/A

China Jo-Jo Drugstores has lower revenue, but higher earnings than Diplomat Pharmacy.

Profitability

This table compares Diplomat Pharmacy and China Jo-Jo Drugstores’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Diplomat Pharmacy -8.93% -4.01% -1.32%
China Jo-Jo Drugstores -2.37% -15.04% -3.67%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Diplomat Pharmacy and China Jo-Jo Drugstores, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Diplomat Pharmacy 2 9 2 0 2.00
China Jo-Jo Drugstores 0 0 0 0 N/A

Diplomat Pharmacy currently has a consensus price target of $10.13, suggesting a potential upside of 77.32%. Given Diplomat Pharmacy’s higher probable upside, equities analysts plainly believe Diplomat Pharmacy is more favorable than China Jo-Jo Drugstores.

Volatility & Risk

Diplomat Pharmacy has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, China Jo-Jo Drugstores has a beta of 0.38, meaning that its share price is 62% less volatile than the S&P 500.

Insider and Institutional Ownership

87.9% of Diplomat Pharmacy shares are owned by institutional investors. Comparatively, 18.0% of China Jo-Jo Drugstores shares are owned by institutional investors. 24.1% of Diplomat Pharmacy shares are owned by company insiders. Comparatively, 31.3% of China Jo-Jo Drugstores shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Diplomat Pharmacy beats China Jo-Jo Drugstores on 7 of the 11 factors compared between the two stocks.

About Diplomat Pharmacy

Diplomat Pharmacy, Inc. operates as an independent specialty pharmacy in the United States. The company operates through Specialty and PBM (pharmacy benefit management) segment. It provides specialty infusion pharmacy, patient care coordination, clinical, compliance and persistency program, patient financial assistance, specialty pharmacy training, 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 primarily focuses 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. It also offers PBM services, including electronic point-of-sale pharmacy claims management, retail pharmacy network management, mail pharmacy claims management, specialty pharmacy claims management, Medicare Part D services, benefit design consultation, drug review and analysis, consulting services, data access, and reporting, information analysis, and preferred drug management programs to managed care organizations, self-insured employer groups, unions, and third-party healthcare plan administrators and worker's compensation payers. The company was founded in 1975 and is headquartered in Flint, Michigan.

About China Jo-Jo Drugstores

China Jo-Jo Drugstores, Inc., together with its subsidiaries, operates as a retailer and distributor of pharmaceutical and other healthcare products in the People's Republic of China. The company operates through four segments: Retail Drugstores, Online Pharmacy, Drug Wholesale, and Herb Farming. Its stores provide various pharmaceutical products, including prescription and over-the-counter drugs, nutritional supplements, traditional Chinese medicines (TCM), personal and family care products, and medical devices, as well as convenience products, such as consumable, seasonal, and promotional items. The company also operates licensed doctors of Western medicine and TCM onsite for consultation, examination, and treatment of common ailments at scheduled hours. In addition, it operates dada360.com, an online drugstore that retails OTC drugs and nutritional supplements. Further, the company distributes third-party pharmaceutical products primarily to trading companies, as well as cultivates and wholesales herbs used for TCM. As of March 31, 2018, it had 122 retail pharmacies under the Jiuzhou Grand Pharmacy name, as well as operates 9 drugstores under the Jiuzhou Grand Pharmacy name in Zhejiang Province. China Jo-Jo Drugstores, Inc. is headquartered in Hangzhou, the People's Republic of China.

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