GSK PLC-SPON ADR (GSK) Stock Fundamental Analysis
USA - NYSE:GSK - US37733W2044 - ADR
40.36 USD
+0.31 (+0.77%)
40.26 USD
-0.1 (-0.25%)
Taking everything into account, GSK scores 6 out of 10 in our fundamental rating. GSK was compared to 196 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
GSK had positive earnings in the past year.
In the past year GSK had a positive cash flow from operations.
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
Looking at the Return On Assets, with a value of 5.78%, GSK belongs to the top of the industry, outperforming 89.80% of the companies in the same industry.
With an excellent Return On Equity value of 23.14%, GSK belongs to the best of the industry, outperforming 92.86% of the companies in the same industry.
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.
GSK had an Average Return On Invested Capital over the past 3 years of 18.38%. This 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
Looking at the Profit Margin, with a value of 10.82%, GSK belongs to the top 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.
With an excellent Operating Margin value of 25.25%, GSK belongs to the best of the industry, outperforming 91.84% of the companies in the same industry.
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so GSK is creating value.
The number of shares outstanding for GSK has been increased compared to 1 year ago.
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
GSK has an Altman-Z score of 1.96. This is not the best score and indicates that GSK is in the grey zone with still only limited risk for bankruptcy at the moment.
GSK's Altman-Z score of 1.96 is fine compared to the rest of the industry. GSK outperforms 65.31% 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.
With an excellent Debt to FCF ratio value of 3.72, GSK belongs to the best of the industry, outperforming 88.78% of the companies in the same industry.
A Debt/Equity ratio of 1.03 is on the high side and indicates that GSK has dependencies on debt financing.
With a Debt to Equity ratio value of 1.03, GSK is not doing good in the industry: 71.94% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.03 | ||
| Debt/FCF | 3.72 | ||
| Altman-Z | 1.96 |
ROIC/WACC2.17
WACC8.15%
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 worse Current ratio (0.87) than 85.20% of its industry peers.
A Quick Ratio of 0.57 indicates that GSK may have some problems paying its short term obligations.
GSK has a worse Quick ratio (0.57) than 89.29% 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%.
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.
GSK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.79% yearly.
EPS Next Y4.79%
EPS Next 2Y6.3%
EPS Next 3Y7.63%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 8.83, which indicates a very decent valuation of GSK.
91.33% of the companies in the same industry are more expensive than GSK, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.20, GSK is valued rather cheaply.
The Price/Forward Earnings ratio is 8.05, which indicates a very decent valuation of GSK.
GSK's Price/Forward Earnings ratio is rather cheap when compared to the industry. GSK is cheaper than 88.78% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of GSK to the average of the S&P500 Index (22.70), we can say GSK is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.83 | ||
| Fwd PE | 8.05 |
4.2 Price Multiples
GSK's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. GSK is cheaper than 95.41% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, GSK is valued cheaper than 88.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.77 | ||
| EV/EBITDA | 6.24 |
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.
GSK has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.84
PEG (5Y)15.73
EPS Next 2Y6.3%
EPS Next 3Y7.63%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.22%, GSK is a good candidate for dividend investing.
GSK's Dividend Yield is rather good when compared to the industry average which is at 5.04. GSK pays more dividend than 94.90% of the companies in the same industry.
GSK's Dividend Yield is rather good when compared to the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.22% |
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
GSK pays out 72.80% of its income as dividend. This is not a sustainable payout ratio.
DP72.8%
EPS Next 2Y6.3%
EPS Next 3Y7.63%
40.36
+0.31 (+0.77%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners39.99%
Inst Owner Change0%
Ins Owners0.16%
Ins Owner ChangeN/A
Market Cap81.31B
Analysts68.39
Price Target45.64 (13.08%)
Short Float %0.56%
Short Ratio2.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.22% |
Yearly Dividend1.65
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)2.55%
PT rev (3m)1.41%
EPS NQ rev (1m)-0.08%
EPS NQ rev (3m)-5.35%
EPS NY rev (1m)-3.34%
EPS NY rev (3m)-3.55%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-1.73%
Revenue NY rev (1m)-0.12%
Revenue NY rev (3m)-1.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.83 | ||
| Fwd PE | 8.05 | ||
| P/S | 1.88 | ||
| P/FCF | 12.77 | ||
| P/OCF | 7.71 | ||
| P/B | 4.03 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.24 |
EPS(TTM)4.57
EY11.32%
EPS(NY)5.01
Fwd EY12.42%
FCF(TTM)3.16
FCFY7.83%
OCF(TTM)5.23
OCFY12.96%
SpS21.42
BVpS10.02
TBVpS-4.96
PEG (NY)1.84
PEG (5Y)15.73
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 | 1.96 |
F-Score5
WACC8.15%
ROIC/WACC2.17
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 Y4.79%
EPS Next 2Y6.3%
EPS Next 3Y7.63%
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 Year31.7%
EBIT Next 3Y14.31%
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%