GSK PLC-SPON ADR (GSK) Stock Fundamental Analysis
USA - NYSE:GSK - US37733W2044 - ADR
45.51 USD
+2.35 (+5.44%)
45.55 USD
+0.04 (+0.09%)
GSK gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 196 industry peers in the Pharmaceuticals industry. GSK has an excellent profitability rating, but there are some minor concerns on its financial health. GSK is cheap, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year GSK was profitable.
GSK had a positive operating cash flow in the past year.
Each year in the past 5 years GSK has been profitable.
GSK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of GSK (5.78%) is better than 89.80% of its industry peers.
GSK's Return On Equity of 23.14% is amongst the best of the industry. GSK outperforms 92.86% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.71%, GSK belongs to the top of the industry, outperforming 95.41% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GSK is above the industry average of 15.28%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.78% | ||
| ROE | 23.14% | ||
| ROIC | 17.71% |
ROA(3y)12.52%
ROA(5y)10.05%
ROE(3y)65.63%
ROE(5y)53.08%
ROIC(3y)18.38%
ROIC(5y)14.53%
1.3 Margins
With an excellent Profit Margin value of 10.82%, GSK belongs to the best of the industry, outperforming 86.73% of the companies in the same industry.
GSK's Profit Margin has declined in the last couple of years.
The Operating Margin of GSK (25.25%) is better than 91.84% of its industry peers.
In the last couple of years the Operating Margin of GSK has remained more or less at the same level.
GSK has a Gross Margin of 71.77%. This is in the better half of the industry: GSK outperforms 79.59% of its industry peers.
GSK's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.25% | ||
| PM (TTM) | 10.82% | ||
| GM | 71.77% |
OM growth 3Y3.67%
OM growth 5Y-0.3%
PM growth 3Y-22.68%
PM growth 5Y-9.82%
GM growth 3Y2.09%
GM growth 5Y0.57%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), GSK is creating value.
The number of shares outstanding for GSK has been increased compared to 1 year ago.
GSK has more shares outstanding than it did 5 years ago.
The debt/assets ratio for GSK has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.08 indicates that GSK is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.08, GSK is doing good in the industry, outperforming 65.31% of the companies in the same industry.
GSK has a debt to FCF ratio of 3.72. This is a good value and a sign of high solvency as GSK would need 3.72 years to pay back of all of its debts.
The Debt to FCF ratio of GSK (3.72) is better than 88.78% of its industry peers.
GSK has a Debt/Equity ratio of 1.03. This is a high value indicating a heavy dependency on external financing.
GSK has a worse Debt to Equity ratio (1.03) than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.03 | ||
| Debt/FCF | 3.72 | ||
| Altman-Z | 2.08 |
ROIC/WACC2.14
WACC8.29%
2.3 Liquidity
GSK has a Current Ratio of 0.87. This is a bad value and indicates that GSK is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.87, GSK is not doing good in the industry: 84.69% of the companies in the same industry are doing better.
A Quick Ratio of 0.57 indicates that GSK may have some problems paying its short term obligations.
With a Quick ratio value of 0.57, GSK is not doing good in the industry: 88.78% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
The earnings per share for GSK have decreased by -0.90% in the last year.
Measured over the past 5 years, GSK shows a small growth in Earnings Per Share. The EPS has been growing by 0.56% on average per year.
GSK shows a small growth in Revenue. In the last year, the Revenue has grown by 0.59%.
GSK shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.45% yearly.
EPS 1Y (TTM)-0.9%
EPS 3Y4.05%
EPS 5Y0.56%
EPS Q2Q%7.14%
Revenue 1Y (TTM)0.59%
Revenue growth 3Y8.31%
Revenue growth 5Y-1.45%
Sales Q2Q%1.29%
3.2 Future
Based on estimates for the next years, GSK will show a small growth in Earnings Per Share. The EPS will grow by 6.72% on average per year.
Based on estimates for the next years, GSK will show a small growth in Revenue. The Revenue will grow by 3.79% on average per year.
EPS Next Y4.82%
EPS Next 2Y6.14%
EPS Next 3Y7.68%
EPS Next 5Y6.72%
Revenue Next Year3.04%
Revenue Next 2Y4.09%
Revenue Next 3Y4.23%
Revenue Next 5Y3.79%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 10.09, the valuation of GSK can be described as reasonable.
Based on the Price/Earnings ratio, GSK is valued cheaper than 90.31% of the companies in the same industry.
GSK's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.79.
The Price/Forward Earnings ratio is 9.22, which indicates a very decent valuation of GSK.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GSK indicates a rather cheap valuation: GSK is cheaper than 87.24% of the companies listed in the same industry.
GSK's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.21.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.09 | ||
| Fwd PE | 9.22 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GSK indicates a rather cheap valuation: GSK is cheaper than 94.39% of the companies listed in the same industry.
87.76% of the companies in the same industry are more expensive than GSK, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.59 | ||
| EV/EBITDA | 6.97 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
GSK has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.09
PEG (5Y)17.97
EPS Next 2Y6.14%
EPS Next 3Y7.68%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.35%, GSK is a good candidate for dividend investing.
GSK's Dividend Yield is rather good when compared to the industry average which is at 5.44. GSK pays more dividend than 94.90% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, GSK pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.35% |
5.2 History
The dividend of GSK decreases each year by -9.84%.
GSK has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of GSK decreased recently.
Dividend Growth(5Y)-9.84%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
72.80% of the earnings are spent on dividend by GSK. This is not a sustainable payout ratio.
DP72.8%
EPS Next 2Y6.14%
EPS Next 3Y7.68%
45.51
+2.35 (+5.44%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners43.15%
Inst Owner Change0%
Ins Owners0.16%
Ins Owner ChangeN/A
Market Cap91.68B
Analysts68.39
Price Target45.64 (0.29%)
Short Float %0.55%
Short Ratio2.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.35% |
Yearly Dividend1.62
Dividend Growth(5Y)-9.84%
DP72.8%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.76%
Min EPS beat(2)7.67%
Max EPS beat(2)9.85%
EPS beat(4)4
Avg EPS beat(4)11.72%
Min EPS beat(4)7.67%
Max EPS beat(4)18.46%
EPS beat(8)7
Avg EPS beat(8)9.56%
EPS beat(12)11
Avg EPS beat(12)10.06%
EPS beat(16)15
Avg EPS beat(16)10.35%
Revenue beat(2)0
Avg Revenue beat(2)-0.82%
Min Revenue beat(2)-1.6%
Max Revenue beat(2)-0.04%
Revenue beat(4)1
Avg Revenue beat(4)-0.85%
Min Revenue beat(4)-3.45%
Max Revenue beat(4)1.68%
Revenue beat(8)5
Avg Revenue beat(8)1.21%
Revenue beat(12)8
Avg Revenue beat(12)1.47%
Revenue beat(16)9
Avg Revenue beat(16)-3.45%
PT rev (1m)2.01%
PT rev (3m)2.54%
EPS NQ rev (1m)-0.23%
EPS NQ rev (3m)-5.35%
EPS NY rev (1m)0.03%
EPS NY rev (3m)-3.52%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-1.73%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-1.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.09 | ||
| Fwd PE | 9.22 | ||
| P/S | 2.15 | ||
| P/FCF | 14.59 | ||
| P/OCF | 8.81 | ||
| P/B | 4.6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.97 |
EPS(TTM)4.51
EY9.91%
EPS(NY)4.93
Fwd EY10.84%
FCF(TTM)3.12
FCFY6.85%
OCF(TTM)5.16
OCFY11.35%
SpS21.15
BVpS9.89
TBVpS-4.89
PEG (NY)2.09
PEG (5Y)17.97
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.78% | ||
| ROE | 23.14% | ||
| ROCE | 20.54% | ||
| ROIC | 17.71% | ||
| ROICexc | 19.52% | ||
| ROICexgc | 52.35% | ||
| OM | 25.25% | ||
| PM (TTM) | 10.82% | ||
| GM | 71.77% | ||
| FCFM | 14.75% |
ROA(3y)12.52%
ROA(5y)10.05%
ROE(3y)65.63%
ROE(5y)53.08%
ROIC(3y)18.38%
ROIC(5y)14.53%
ROICexc(3y)22.56%
ROICexc(5y)17.82%
ROICexgc(3y)78.4%
ROICexgc(5y)77.5%
ROCE(3y)21.97%
ROCE(5y)17.32%
ROICexcg growth 3Y-7.02%
ROICexcg growth 5Y-6.42%
ROICexc growth 3Y24.64%
ROICexc growth 5Y6.13%
OM growth 3Y3.67%
OM growth 5Y-0.3%
PM growth 3Y-22.68%
PM growth 5Y-9.82%
GM growth 3Y2.09%
GM growth 5Y0.57%
F-Score5
Asset Turnover0.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.03 | ||
| Debt/FCF | 3.72 | ||
| Debt/EBITDA | 1.3 | ||
| Cap/Depr | 81.48% | ||
| Cap/Sales | 9.67% | ||
| Interest Coverage | 12.99 | ||
| Cash Conversion | 65.8% | ||
| Profit Quality | 136.31% | ||
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.57 | ||
| Altman-Z | 2.08 |
F-Score5
WACC8.29%
ROIC/WACC2.14
Cap/Depr(3y)108.08%
Cap/Depr(5y)108.56%
Cap/Sales(3y)8.31%
Cap/Sales(5y)9.2%
Profit Quality(3y)87.63%
Profit Quality(5y)97.06%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.9%
EPS 3Y4.05%
EPS 5Y0.56%
EPS Q2Q%7.14%
EPS Next Y4.82%
EPS Next 2Y6.14%
EPS Next 3Y7.68%
EPS Next 5Y6.72%
Revenue 1Y (TTM)0.59%
Revenue growth 3Y8.31%
Revenue growth 5Y-1.45%
Sales Q2Q%1.29%
Revenue Next Year3.04%
Revenue Next 2Y4.09%
Revenue Next 3Y4.23%
Revenue Next 5Y3.79%
EBIT growth 1Y-2.07%
EBIT growth 3Y12.28%
EBIT growth 5Y-1.74%
EBIT Next Year28.11%
EBIT Next 3Y13.02%
EBIT Next 5Y9.85%
FCF growth 1Y103.67%
FCF growth 3Y-10.73%
FCF growth 5Y-9.42%
OCF growth 1Y68.43%
OCF growth 3Y-6.24%
OCF growth 5Y-3.96%