In the dynamic and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating AstraZeneca AZN and its primary competitors in the Pharmaceuticals industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.
AstraZeneca Background
A merger between Astra of Sweden and Zeneca Group of the United Kingdom formed AstraZeneca in 1999. The firm sells branded drugs across several major therapeutic classes, including gastrointestinal, diabetes, cardiovascular, respiratory, cancer, immunology and rare diseases. The majority of sales come from international markets with the United States representing close to one third of its revenue.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| AstraZeneca PLC | 33.42 | 5.26 | 4.38 | 3.68% | $3.33 | $9.4 | 4.64% |
| Eli Lilly and Co | 108.28 | 50.57 | 16.84 | -0.52% | $0.96 | $7.64 | 36.84% |
| Novo Nordisk A/S | 42.15 | 33.81 | 14.81 | 24.5% | $32.76 | $49.02 | 28.89% |
| Johnson & Johnson | 27.63 | 4.98 | 3.90 | 35.56% | $7.24 | $14.74 | 6.78% |
| Merck & Co Inc | 56.33 | 6.23 | 4.36 | 11.87% | $6.95 | $11.7 | 6.71% |
| Novartis AG | 24.23 | 5.04 | 3.65 | 3.91% | $4.88 | $8.97 | 12.14% |
| Pfizer Inc | 16.11 | 1.72 | 2.46 | -2.43% | $-1.1 | $3.96 | -41.55% |
| Bristol-Myers Squibb Co | 12.85 | 3.55 | 2.37 | 6.32% | $4.85 | $8.46 | -2.25% |
| Zoetis Inc | 34.48 | 15.31 | 9.38 | 12.28% | $0.9 | $1.51 | 7.44% |
| GSK PLC | 9.46 | 4.37 | 1.94 | 13.25% | $2.55 | $5.88 | 3.59% |
| Takeda Pharmaceutical Co Ltd | 34.04 | 0.92 | 1.57 | -0.69% | $202.28 | $699.51 | 4.07% |
| Viatris Inc | 6.09 | 0.53 | 0.72 | 1.59% | $1.22 | $1.69 | -3.34% |
| Dr Reddy's Laboratories Ltd | 17.83 | 3.58 | 3.40 | 5.94% | $23.28 | $40.37 | 9.11% |
| Jazz Pharmaceuticals PLC | 144.82 | 2.17 | 2.21 | 4.19% | $0.33 | $0.87 | 3.35% |
| Corcept Therapeutics Inc | 31.29 | 5.59 | 6.29 | 7.06% | $0.03 | $0.12 | 21.5% |
| Amphastar Pharmaceuticals Inc | 20.53 | 4.23 | 4.60 | 8.31% | $0.09 | $0.11 | 50.3% |
| Average | 39.07 | 9.51 | 5.23 | 8.74% | $19.15 | $56.97 | 9.57% |
Through a meticulous analysis of AstraZeneca, we can observe the following trends:
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A Price to Earnings ratio of 33.42 significantly below the industry average by 0.86x suggests undervaluation. This can make the stock appealing for those seeking growth.
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With a Price to Book ratio of 5.26, significantly falling below the industry average by 0.55x, it suggests undervaluation and the possibility of untapped growth prospects.
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The Price to Sales ratio is 4.38, which is 0.84x the industry average. This suggests a possible undervaluation based on sales performance.
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With a Return on Equity (ROE) of 3.68% that is 5.06% below the industry average, it appears that the company exhibits potential inefficiency in utilizing equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $3.33 Billion is 0.17x below the industry average, suggesting potential lower profitability or financial challenges.
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The gross profit of $9.4 Billion is 0.16x below that of its industry, suggesting potential lower revenue after accounting for production costs.
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The company's revenue growth of 4.64% is significantly below the industry average of 9.57%. This suggests a potential struggle in generating increased sales volume.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative to its equity.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
In terms of the Debt-to-Equity ratio, AstraZeneca stands in comparison with its top 4 peers, leading to the following comparisons:
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In terms of the debt-to-equity ratio, AstraZeneca has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.
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This implies that the company relies less on debt financing and has a more favorable balance between debt and equity with a lower debt-to-equity ratio of 0.77.
Key Takeaways
AstraZeneca's low PE, PB, and PS ratios suggest that the company's stock is undervalued compared to its peers in the Pharmaceuticals industry. The low ROE indicates that AstraZeneca's profitability is relatively low compared to its peers. The low EBITDA suggests that the company's operating performance is weaker compared to its industry peers. The low gross profit and revenue growth indicate that AstraZeneca's financial performance and growth potential are lower compared to its industry peers.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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