GSK PLC-SPON ADR (GSK) Stock Fundamental Analysis
USA - NYSE:GSK - US37733W2044 - ADR
44.26 USD
+0.32 (+0.73%)
44.37 USD
+0.11 (+0.25%)
Overall GSK gets a fundamental rating of 6 out of 10. We evaluated GSK against 191 industry peers in the Pharmaceuticals industry. While GSK has a great profitability rating, there are some minor concerns on its financial health. GSK has a bad growth rate and is valued cheaply.
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.
In the past 5 years GSK always reported a positive cash flow from operatings.
1.2 Ratios
GSK has a better Return On Assets (5.78%) than 90.05% of its industry peers.
With an excellent Return On Equity value of 23.14%, GSK belongs to the best of the industry, outperforming 93.19% of the companies in the same industry.
GSK has a Return On Invested Capital of 17.71%. This is amongst the best in the industry. GSK outperforms 95.29% of its industry peers.
The Average Return On Invested Capital over the past 3 years for GSK is above the industry average of 15.45%.
| 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
The Profit Margin of GSK (10.82%) is better than 86.91% of its industry peers.
GSK's Profit Margin has declined in the last couple of years.
The Operating Margin of GSK (25.25%) is better than 91.62% of its industry peers.
GSK's Operating Margin has been stable in the last couple of years.
GSK has a better Gross Margin (71.77%) than 79.58% of its industry peers.
In the last couple of years the Gross Margin of GSK has remained more or less at the same level.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so GSK is creating value.
Compared to 1 year ago, GSK has more shares outstanding
The number of shares outstanding for GSK has been increased compared to 5 years ago.
GSK has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.05 indicates that GSK is not a great score, but indicates only limited risk for bankruptcy at the moment.
GSK has a better Altman-Z score (2.05) than 64.40% of its industry peers.
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 88.48% 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.
With a Debt to Equity ratio value of 1.03, GSK is not doing good in the industry: 72.77% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.03 | ||
| Debt/FCF | 3.72 | ||
| Altman-Z | 2.05 |
ROIC/WACC2.07
WACC8.56%
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.
GSK has a Current ratio of 0.87. This is amonst the worse of the industry: GSK underperforms 86.91% of its industry peers.
GSK has a Quick 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.
GSK's Quick ratio of 0.57 is on the low side compared to the rest of the industry. GSK is outperformed by 89.53% of its industry peers.
| 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.
GSK shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 0.56% yearly.
GSK shows a small growth in Revenue. In the last year, the Revenue has grown by 0.59%.
Measured over the past years, GSK shows a decrease in Revenue. The Revenue has been decreasing by -1.45% on average per year.
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 6.96% on average per year.
GSK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.82% yearly.
EPS Next Y4.82%
EPS Next 2Y6.14%
EPS Next 3Y7.68%
EPS Next 5Y6.96%
Revenue Next Year3.11%
Revenue Next 2Y4.15%
Revenue Next 3Y4.25%
Revenue Next 5Y3.82%
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
A Price/Earnings ratio of 9.86 indicates a reasonable valuation of GSK.
GSK's Price/Earnings ratio is rather cheap when compared to the industry. GSK is cheaper than 90.58% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.77, GSK is valued rather cheaply.
The Price/Forward Earnings ratio is 9.02, which indicates a very decent valuation of GSK.
86.39% of the companies in the same industry are more expensive than GSK, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.23, GSK is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.86 | ||
| Fwd PE | 9.02 |
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 93.72% of the companies listed in the same industry.
GSK's Price/Free Cash Flow ratio is rather cheap when compared to the industry. GSK is cheaper than 87.96% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.26 | ||
| EV/EBITDA | 6.8 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GSK does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of GSK may justify a higher PE ratio.
PEG (NY)2.04
PEG (5Y)17.56
EPS Next 2Y6.14%
EPS Next 3Y7.68%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.92%, GSK has a reasonable but not impressive dividend return.
GSK's Dividend Yield is rather good when compared to the industry average which is at 6.88. GSK pays more dividend than 95.81% of the companies in the same industry.
GSK's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.92% |
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.
GSK has decreased its dividend 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%
44.26
+0.32 (+0.73%)
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 Cap89.02B
Revenue(TTM)31.63B
Net Income(TTM)3.42B
Analysts68.39
Price Target44.36 (0.23%)
Short Float %0.55%
Short Ratio2.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.92% |
Yearly Dividend1.64
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)-2.8%
PT rev (3m)-0.6%
EPS NQ rev (1m)0.84%
EPS NQ rev (3m)-3.5%
EPS NY rev (1m)0.2%
EPS NY rev (3m)-3.53%
Revenue NQ rev (1m)0.14%
Revenue NQ rev (3m)0.33%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)-1.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.86 | ||
| Fwd PE | 9.02 | ||
| P/S | 2.1 | ||
| P/FCF | 14.26 | ||
| P/OCF | 8.62 | ||
| P/B | 4.5 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.8 |
EPS(TTM)4.49
EY10.14%
EPS(NY)4.91
Fwd EY11.09%
FCF(TTM)3.1
FCFY7.01%
OCF(TTM)5.14
OCFY11.61%
SpS21.03
BVpS9.84
TBVpS-4.87
PEG (NY)2.04
PEG (5Y)17.56
Graham Number31.52
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%
ROICexgc growth 3Y-7.02%
ROICexgc 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 | 2.05 |
F-Score5
WACC8.56%
ROIC/WACC2.07
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 5Y6.96%
Revenue 1Y (TTM)0.59%
Revenue growth 3Y8.31%
Revenue growth 5Y-1.45%
Sales Q2Q%1.29%
Revenue Next Year3.11%
Revenue Next 2Y4.15%
Revenue Next 3Y4.25%
Revenue Next 5Y3.82%
EBIT growth 1Y-2.07%
EBIT growth 3Y12.28%
EBIT growth 5Y-1.74%
EBIT Next Year28.11%
EBIT Next 3Y13.02%
EBIT Next 5Y9.91%
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%