GILEAD SCIENCES INC (GIS.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:GIS - US3755581036 - Common Stock
112.4 EUR
+3.9 (+3.59%)
Overall GIS gets a fundamental rating of 6 out of 10. We evaluated GIS against 86 industry peers in the Biotechnology industry. While GIS has a great profitability rating, there are some minor concerns on its financial health. GIS may be a bit undervalued, certainly considering the very reasonable score on growth GIS also has an excellent dividend rating. These ratings would make GIS suitable for value and dividend investing!
1. Profitability
1.1 Basic Checks
- GIS had positive earnings in the past year.
- In the past year GIS had a positive cash flow from operations.
- In the past 5 years GIS has always been profitable.
- GIS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 13.86%, GIS belongs to the best of the industry, outperforming 89.53% of the companies in the same industry.
- The Return On Equity of GIS (37.80%) is better than 96.51% of its industry peers.
- GIS has a better Return On Invested Capital (18.54%) than 97.67% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for GIS is above the industry average of 11.58%.
- The 3 year average ROIC (16.22%) for GIS is below the current ROIC(18.54%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.86% | ||
| ROE | 37.8% | ||
| ROIC | 18.54% |
ROA(3y)5.73%
ROA(5y)5.31%
ROE(3y)16.3%
ROE(5y)15.83%
ROIC(3y)16.22%
ROIC(5y)15.08%
1.3 Margins
- GIS's Profit Margin of 27.88% is amongst the best of the industry. GIS outperforms 87.21% of its industry peers.
- GIS's Profit Margin has declined in the last couple of years.
- GIS has a better Operating Margin (38.96%) than 96.51% of its industry peers.
- GIS's Operating Margin has improved in the last couple of years.
- The Gross Margin of GIS (78.72%) is better than 70.93% of its industry peers.
- In the last couple of years the Gross Margin of GIS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.96% | ||
| PM (TTM) | 27.88% | ||
| GM | 78.72% |
OM growth 3Y0.61%
OM growth 5Y7.43%
PM growth 3Y-58.16%
PM growth 5Y-41.32%
GM growth 3Y1.06%
GM growth 5Y-0.95%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), GIS is creating value.
- GIS has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, GIS has less shares outstanding
- Compared to 1 year ago, GIS has a worse debt to assets ratio.
2.2 Solvency
- GIS has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | N/A |
ROIC/WACC2.22
WACC8.34%
2.3 Liquidity
- GIS has a Current Ratio of 1.53. This is a normal value and indicates that GIS is financially healthy and should not expect problems in meeting its short term obligations.
- GIS's Current ratio of 1.53 is on the low side compared to the rest of the industry. GIS is outperformed by 60.47% of its industry peers.
- GIS has a Quick Ratio of 1.17. This is a normal value and indicates that GIS is financially healthy and should not expect problems in meeting its short term obligations.
- With a Quick ratio value of 1.17, GIS is not doing good in the industry: 61.63% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.53 | ||
| Quick Ratio | 1.17 |
3. Growth
3.1 Past
- GIS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 84.88%, which is quite impressive.
- The Earnings Per Share has been decreasing by -7.01% on average over the past years.
- The Revenue has been growing slightly by 2.78% in the past year.
- The Revenue has been growing slightly by 5.08% on average over the past years.
EPS 1Y (TTM)84.88%
EPS 3Y-14.17%
EPS 5Y-7.01%
EPS Q2Q%22.28%
Revenue 1Y (TTM)2.78%
Revenue growth 3Y1.74%
Revenue growth 5Y5.08%
Sales Q2Q%2.97%
3.2 Future
- The Earnings Per Share is expected to grow by 19.03% on average over the next years. This is quite good.
- Based on estimates for the next years, GIS will show a small growth in Revenue. The Revenue will grow by 3.76% on average per year.
EPS Next Y80.49%
EPS Next 2Y39.19%
EPS Next 3Y27.36%
EPS Next 5Y19.03%
Revenue Next Year3.2%
Revenue Next 2Y3.32%
Revenue Next 3Y3.79%
Revenue Next 5Y3.76%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 16.06, the valuation of GIS can be described as correct.
- Based on the Price/Earnings ratio, GIS is valued cheaper than 89.53% of the companies in the same industry.
- When comparing the Price/Earnings ratio of GIS to the average of the S&P500 Index (27.30), we can say GIS is valued slightly cheaper.
- GIS is valuated correctly with a Price/Forward Earnings ratio of 14.73.
- GIS's Price/Forward Earnings ratio is rather cheap when compared to the industry. GIS is cheaper than 91.86% of the companies in the same industry.
- GIS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.06 | ||
| Fwd PE | 14.73 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GIS indicates a rather cheap valuation: GIS is cheaper than 86.05% of the companies listed in the same industry.
- Based on the Price/Free Cash Flow ratio, GIS is valued cheaply inside the industry as 87.21% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.15 | ||
| EV/EBITDA | 10.91 |
4.3 Compensation for Growth
- GIS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- GIS has an outstanding profitability rating, which may justify a higher PE ratio.
- GIS's earnings are expected to grow with 27.36% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.2
PEG (5Y)N/A
EPS Next 2Y39.19%
EPS Next 3Y27.36%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.61%, GIS has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.75, GIS pays a better dividend. On top of this GIS pays more dividend than 93.02% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, GIS pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.61% |
5.2 History
- The dividend of GIS has a limited annual growth rate of 4.45%.
Dividend Growth(5Y)4.45%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
- GIS pays out 12.00% of its income as dividend. This is a sustainable payout ratio.
- The dividend of GIS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP12%
EPS Next 2Y39.19%
EPS Next 3Y27.36%
GILEAD SCIENCES INC / GIS.DE FAQ
What is the fundamental rating for GIS stock?
ChartMill assigns a fundamental rating of 6 / 10 to GIS.DE.
What is the valuation status of GILEAD SCIENCES INC (GIS.DE) stock?
ChartMill assigns a valuation rating of 8 / 10 to GILEAD SCIENCES INC (GIS.DE). This can be considered as Undervalued.
How profitable is GILEAD SCIENCES INC (GIS.DE) stock?
GILEAD SCIENCES INC (GIS.DE) has a profitability rating of 8 / 10.
What is the financial health of GILEAD SCIENCES INC (GIS.DE) stock?
The financial health rating of GILEAD SCIENCES INC (GIS.DE) is 5 / 10.
Can you provide the expected EPS growth for GIS stock?
The Earnings per Share (EPS) of GILEAD SCIENCES INC (GIS.DE) is expected to grow by 80.49% in the next year.