WEST PHARMACEUTICAL SERVICES (WST) Stock Fundamental Analysis
NYSE:WST - New York Stock Exchange, Inc. - US9553061055 - Common Stock - Currency: USD
WST gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 56 industry peers in the Life Sciences Tools & Services industry. WST has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. WST is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
WST had positive earnings in the past year.
In the past year WST had a positive cash flow from operations.
In the past 5 years WST has always been profitable.
WST had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
WST's Return On Assets of 12.91% is amongst the best of the industry. WST outperforms 91.07% of its industry peers.
WST has a Return On Equity of 17.41%. This is amongst the best in the industry. WST outperforms 89.29% of its industry peers.
With an excellent Return On Invested Capital value of 15.53%, WST belongs to the best of the industry, outperforming 91.07% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WST is above the industry average of 13.15%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.91% | ||
| ROE | 17.41% | ||
| ROIC | 15.53% |
ROA(3y)15.07%
ROA(5y)15.52%
ROE(3y)20.26%
ROE(5y)21.56%
ROIC(3y)17.99%
ROIC(5y)18.35%
1.3 Margins
WST has a Profit Margin of 16.13%. This is amongst the best in the industry. WST outperforms 92.86% of its industry peers.
In the last couple of years the Profit Margin of WST has grown nicely.
With an excellent Operating Margin value of 20.21%, WST belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
In the last couple of years the Operating Margin of WST has grown nicely.
WST has a worse Gross Margin (34.54%) than 66.07% of its industry peers.
WST's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.21% | ||
| PM (TTM) | 16.13% | ||
| GM | 34.54% |
OM growth 3Y-8.66%
OM growth 5Y4.7%
PM growth 3Y-10.02%
PM growth 5Y5.33%
GM growth 3Y-6.03%
GM growth 5Y0.95%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so WST is still creating some value.
The number of shares outstanding for WST has been reduced compared to 1 year ago.
WST has less shares outstanding than it did 5 years ago.
WST has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 13.68 indicates that WST is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 13.68, WST belongs to the best of the industry, outperforming 96.43% of the companies in the same industry.
The Debt to FCF ratio of WST is 0.67, which is an excellent value as it means it would take WST, only 0.67 years of fcf income to pay off all of its debts.
WST has a Debt to FCF ratio of 0.67. This is amongst the best in the industry. WST outperforms 91.07% of its industry peers.
A Debt/Equity ratio of 0.08 indicates that WST is not too dependend on debt financing.
The Debt to Equity ratio of WST (0.08) is better than 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.67 | ||
| Altman-Z | 13.68 |
ROIC/WACC1.48
WACC10.49%
2.3 Liquidity
A Current Ratio of 2.77 indicates that WST has no problem at all paying its short term obligations.
WST has a Current ratio (2.77) which is comparable to the rest of the industry.
WST has a Quick Ratio of 2.03. This indicates that WST is financially healthy and has no problem in meeting its short term obligations.
With a Quick ratio value of 2.03, WST perfoms like the industry average, outperforming 46.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.03 |
3. Growth
3.1 Past
WST shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -13.32%.
WST shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.81% yearly.
Looking at the last year, WST shows a decrease in Revenue. The Revenue has decreased by -1.12% in the last year.
The Revenue has been growing by 9.48% on average over the past years. This is quite good.
EPS 1Y (TTM)-13.32%
EPS 3Y-7.79%
EPS 5Y15.81%
EPS Q2Q%-7.05%
Revenue 1Y (TTM)-1.12%
Revenue growth 3Y0.72%
Revenue growth 5Y9.48%
Sales Q2Q%0.37%
3.2 Future
Based on estimates for the next years, WST will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.79% on average per year.
WST is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.60% yearly.
EPS Next Y-6.1%
EPS Next 2Y3.1%
EPS Next 3Y7.36%
EPS Next 5Y9.79%
Revenue Next Year2.68%
Revenue Next 2Y4.24%
Revenue Next 3Y5%
Revenue Next 5Y6.6%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 34.21, WST can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of WST indicates a somewhat cheap valuation: WST is cheaper than 62.50% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.41. WST is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 31.66, the valuation of WST can be described as expensive.
64.29% of the companies in the same industry are more expensive than WST, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 35.19. WST is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.21 | ||
| Fwd PE | 31.66 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WST is valued a bit cheaper than 71.43% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WST is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 53.19 | ||
| EV/EBITDA | 21.64 |
4.3 Compensation for Growth
The excellent profitability rating of WST may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.16
EPS Next 2Y3.1%
EPS Next 3Y7.36%
5. Dividend
5.1 Amount
WST has a yearly dividend return of 0.37%, which is pretty low.
WST's Dividend Yield is rather good when compared to the industry average which is at 0.50. WST pays more dividend than 87.50% of the companies in the same industry.
With a Dividend Yield of 0.37, WST pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.37% |
5.2 History
The dividend of WST has a limited annual growth rate of 5.90%.
WST has paid a dividend for at least 10 years, which is a reliable track record.
WST has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.9%
Div Incr Years32
Div Non Decr Years34
5.3 Sustainability
WST pays out 12.76% of its income as dividend. This is a sustainable payout ratio.
The dividend of WST is growing, but earnings are growing more, so the dividend growth is sustainable.
DP12.76%
EPS Next 2Y3.1%
EPS Next 3Y7.36%
227.18
-2.05 (-0.89%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryLife Sciences Tools & Services
Earnings (Last)
Earnings (Next)
Inst Owners97.98%
Inst Owner Change0%
Ins Owners0.34%
Ins Owner Change0.73%
Market Cap16.32B
Analysts81.05
Price Target283.2 (24.66%)
Short Float %2.92%
Short Ratio2.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.37% |
Yearly Dividend0.81
Dividend Growth(5Y)5.9%
DP12.76%
Div Incr Years32
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.59%
Min EPS beat(2)4.78%
Max EPS beat(2)16.4%
EPS beat(4)3
Avg EPS beat(4)7.43%
Min EPS beat(4)-13.56%
Max EPS beat(4)22.11%
EPS beat(8)7
Avg EPS beat(8)9.57%
EPS beat(12)10
Avg EPS beat(12)10.56%
EPS beat(16)14
Avg EPS beat(16)12.06%
Revenue beat(2)2
Avg Revenue beat(2)0.44%
Min Revenue beat(2)0.12%
Max Revenue beat(2)0.77%
Revenue beat(4)3
Avg Revenue beat(4)0.1%
Min Revenue beat(4)-4.69%
Max Revenue beat(4)4.21%
Revenue beat(8)4
Avg Revenue beat(8)-0.19%
Revenue beat(12)7
Avg Revenue beat(12)0.06%
Revenue beat(16)10
Avg Revenue beat(16)0.65%
PT rev (1m)0%
PT rev (3m)-1.09%
EPS NQ rev (1m)0.03%
EPS NQ rev (3m)2.81%
EPS NY rev (1m)-0.31%
EPS NY rev (3m)2.49%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.21 | ||
| Fwd PE | 31.66 | ||
| P/S | 5.64 | ||
| P/FCF | 53.19 | ||
| P/OCF | 24.56 | ||
| P/B | 6.08 | ||
| P/tB | 6.36 | ||
| EV/EBITDA | 21.64 |
EPS(TTM)6.64
EY2.92%
EPS(NY)7.18
Fwd EY3.16%
FCF(TTM)4.27
FCFY1.88%
OCF(TTM)9.25
OCFY4.07%
SpS40.3
BVpS37.34
TBVpS35.71
PEG (NY)N/A
PEG (5Y)2.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.91% | ||
| ROE | 17.41% | ||
| ROCE | 18.93% | ||
| ROIC | 15.53% | ||
| ROICexc | 17.87% | ||
| ROICexgc | 18.69% | ||
| OM | 20.21% | ||
| PM (TTM) | 16.13% | ||
| GM | 34.54% | ||
| FCFM | 10.6% |
ROA(3y)15.07%
ROA(5y)15.52%
ROE(3y)20.26%
ROE(5y)21.56%
ROIC(3y)17.99%
ROIC(5y)18.35%
ROICexc(3y)23.92%
ROICexc(5y)24.8%
ROICexgc(3y)25.26%
ROICexgc(5y)26.44%
ROCE(3y)21.92%
ROCE(5y)22.37%
ROICexcg growth 3Y-17.09%
ROICexcg growth 5Y2.48%
ROICexc growth 3Y-16.41%
ROICexc growth 5Y3.44%
OM growth 3Y-8.66%
OM growth 5Y4.7%
PM growth 3Y-10.02%
PM growth 5Y5.33%
GM growth 3Y-6.03%
GM growth 5Y0.95%
F-Score5
Asset Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.67 | ||
| Debt/EBITDA | 0.28 | ||
| Cap/Depr | 223.84% | ||
| Cap/Sales | 12.35% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 89.21% | ||
| Profit Quality | 65.69% | ||
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.03 | ||
| Altman-Z | 13.68 |
F-Score5
WACC10.49%
ROIC/WACC1.48
Cap/Depr(3y)247.41%
Cap/Depr(5y)221.86%
Cap/Sales(3y)11.72%
Cap/Sales(5y)10.45%
Profit Quality(3y)66.98%
Profit Quality(5y)67.4%
High Growth Momentum
Growth
EPS 1Y (TTM)-13.32%
EPS 3Y-7.79%
EPS 5Y15.81%
EPS Q2Q%-7.05%
EPS Next Y-6.1%
EPS Next 2Y3.1%
EPS Next 3Y7.36%
EPS Next 5Y9.79%
Revenue 1Y (TTM)-1.12%
Revenue growth 3Y0.72%
Revenue growth 5Y9.48%
Sales Q2Q%0.37%
Revenue Next Year2.68%
Revenue Next 2Y4.24%
Revenue Next 3Y5%
Revenue Next 5Y6.6%
EBIT growth 1Y-11.55%
EBIT growth 3Y-8.01%
EBIT growth 5Y14.63%
EBIT Next Year26.95%
EBIT Next 3Y15.99%
EBIT Next 5Y16.06%
FCF growth 1Y-25.15%
FCF growth 3Y-5.79%
FCF growth 5Y2.8%
OCF growth 1Y-6.51%
OCF growth 3Y3.81%
OCF growth 5Y12.22%