WEST PHARMACEUTICAL SERVICES (WST) Stock Fundamental Analysis
NYSE:WST - New York Stock Exchange, Inc. - US9553061055 - Common Stock - Currency: USD
Taking everything into account, WST scores 6 out of 10 in our fundamental rating. WST was compared to 55 industry peers in the Life Sciences Tools & Services industry. Both the health and profitability get an excellent rating, making WST a very profitable company, without any liquidiy or solvency issues. WST is valied quite expensively at the moment, while 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.
In the past 5 years WST always reported a positive cash flow from operatings.
1.2 Ratios
WST has a Return On Assets of 12.91%. This is amongst the best in the industry. WST outperforms 90.91% of its industry peers.
WST's Return On Equity of 17.41% is amongst the best of the industry. WST outperforms 89.09% of its industry peers.
WST has a better Return On Invested Capital (15.53%) than 90.91% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WST is above the industry average of 13.60%.
| 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
The Profit Margin of WST (16.13%) is better than 92.73% of its industry peers.
WST's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 20.21%, WST belongs to the top of the industry, outperforming 85.45% of the companies in the same industry.
In the last couple of years the Operating Margin of WST has grown nicely.
WST's Gross Margin of 34.54% is on the low side compared to the rest of the industry. WST is outperformed by 65.45% of its industry peers.
In the last couple of years the Gross Margin of WST has remained more or less at the same level.
| 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.
WST has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, WST has less shares outstanding
The debt/assets ratio for WST is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 13.29 indicates that WST is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 13.29, WST belongs to the best of the industry, outperforming 96.36% of the companies in the same industry.
WST has a debt to FCF ratio of 0.67. This is a very positive value and a sign of high solvency as it would only need 0.67 years to pay back of all of its debts.
WST has a better Debt to FCF ratio (0.67) than 90.91% of its industry peers.
WST has a Debt/Equity ratio of 0.08. This is a healthy value indicating a solid balance between debt and equity.
WST's Debt to Equity ratio of 0.08 is fine compared to the rest of the industry. WST outperforms 63.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.08 | ||
| Debt/FCF | 0.67 | ||
| Altman-Z | 13.29 |
ROIC/WACC1.55
WACC10.04%
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 in line with its industry peers.
A Quick Ratio of 2.03 indicates that WST has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.03, WST is in line with its industry, outperforming 47.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.77 | ||
| Quick Ratio | 2.03 |
3. Growth
3.1 Past
The earnings per share for WST have decreased strongly by -13.32% in the last year.
Measured over the past years, WST shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.81% on average per year.
The Revenue has decreased by -1.12% in the past 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
The Earnings Per Share is expected to grow by 9.79% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.60% on average over the next years.
EPS Next Y-5.81%
EPS Next 2Y3.34%
EPS Next 3Y7.55%
EPS Next 5Y9.79%
Revenue Next Year2.68%
Revenue Next 2Y4.25%
Revenue Next 3Y5.03%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 32.95, the valuation of WST can be described as expensive.
63.64% of the companies in the same industry are more expensive than WST, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.15. WST is valued slightly more expensive when compared to this.
A Price/Forward Earnings ratio of 30.35 indicates a quite expensive valuation of WST.
Based on the Price/Forward Earnings ratio, WST is valued a bit cheaper than the industry average as 65.45% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 21.60. WST is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.95 | ||
| Fwd PE | 30.35 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WST indicates a somewhat cheap valuation: WST is cheaper than 74.55% of the companies listed in the same industry.
WST's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 51.22 | ||
| EV/EBITDA | 20.84 |
4.3 Compensation for Growth
WST has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.08
EPS Next 2Y3.34%
EPS Next 3Y7.55%
5. Dividend
5.1 Amount
With a yearly dividend of 0.38%, WST is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 0.51, WST pays a better dividend. On top of this WST pays more dividend than 87.27% of the companies listed in the same industry.
With a Dividend Yield of 0.38, WST pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
5.2 History
The dividend of WST has a limited annual growth rate of 5.90%.
WST has been paying a dividend for at least 10 years, so it has a reliable track record.
WST has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.9%
Div Incr Years32
Div Non Decr Years34
5.3 Sustainability
12.76% of the earnings are spent on dividend by WST. This is a low number and sustainable payout ratio.
WST's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP12.76%
EPS Next 2Y3.34%
EPS Next 3Y7.55%
218.8
-0.07 (-0.03%)
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 Change1.16%
Ins Owners0.34%
Ins Owner Change0.73%
Market Cap15.72B
Analysts82.22
Price Target283.2 (29.43%)
Short Float %2.99%
Short Ratio2.62
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
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)0.03%
PT rev (3m)-1.32%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.63%
EPS NY rev (1m)0%
EPS NY rev (3m)2.81%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.95 | ||
| Fwd PE | 30.35 | ||
| P/S | 5.43 | ||
| P/FCF | 51.22 | ||
| P/OCF | 23.65 | ||
| P/B | 5.86 | ||
| P/tB | 6.13 | ||
| EV/EBITDA | 20.84 |
EPS(TTM)6.64
EY3.03%
EPS(NY)7.21
Fwd EY3.29%
FCF(TTM)4.27
FCFY1.95%
OCF(TTM)9.25
OCFY4.23%
SpS40.3
BVpS37.34
TBVpS35.71
PEG (NY)N/A
PEG (5Y)2.08
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 | 13.29 |
F-Score5
WACC10.04%
ROIC/WACC1.55
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-5.81%
EPS Next 2Y3.34%
EPS Next 3Y7.55%
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 2Y4.25%
Revenue Next 3Y5.03%
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%