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Emergent BioSolutions Inc
EBS : NYSE : Health Care
$27.64 1.28 | 4.86%
Today's Range: 26.29 - 27.83
Avg. Daily Volume: 210,200
12/24/14 - 1:02 PM ET

Financial Analysis


EMERGENT BIOSOLUTIONS INC's gross profit margin for the third quarter of its fiscal year 2014 is essentially unchanged when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. EMERGENT BIOSOLUTIONS INC is extremely liquid. Currently, the Quick Ratio is 3.62 which clearly shows the ability to cover any short-term cash needs. EBS managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

During the same period, stockholders' equity ("net worth") has increased by 9.80% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY14 Q3 FY13
Net Sales ($mil)137.9589.1
EBITDA ($mil)43.7123.61
EBIT ($mil)34.7218.43
Net Income ($mil)21.8313.49


Balance Sheet Q3 FY14 Q3 FY13
Cash & Equiv. ($mil)242.25172.56
Total Assets ($mil)869.29595.46
Total Debt ($mil)251.059.42
Equity ($mil)513.14467.31


Profitability Q3 FY14 Q3 FY13
Gross Profit Margin84.8983.29
EBITDA Margin31.6826.49
Operating Margin25.1720.69
Sales Turnover0.460.52
Return on Assets2.515.37
Return on Equity4.256.85
Debt Q3 FY14 Q3 FY13
Current Ratio4.714.13
Debt/Capital0.330.11
Interest Expense2.340.0
Interest Coverage14.870.0


Share Data Q3 FY14 Q3 FY13
Shares outstanding (mil)37.5536.31
Div / share0.00.0
EPS0.490.36
Book value / share13.6712.87
Institutional Own % n/a n/a
Avg Daily Volume206207.0207537.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 71.67 for the Biotechnology industry and a significant premium compared to the S&P 500 average of 19.99. To use another comparison, its price-to-book ratio of 1.97 indicates a discount versus the S&P 500 average of 2.76 and a significant discount versus the industry average of 11.96. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, EMERGENT BIOSOLUTIONS INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
EBS 56.21 Peers 71.67   EBS 14.77 Peers 33.35

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

EBS is trading at a discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

EBS is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
EBS 19.27 Peers 27.35   EBS 1.54 Peers 2.64

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

EBS is trading at a discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

EBS trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
EBS 1.97 Peers 11.96   EBS -44.83 Peers 32.11

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

EBS is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, EBS is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
EBS 2.53 Peers 197.44   EBS 29.43 Peers 73.03

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

EBS is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

EBS significantly trails its peers on the basis of sales growth

 

 

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