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West Pharmaceutical Services Inc
WST : NYSE : Health Care
$42.42 | %
Today's Range: 41.78 - 42.60
Avg. Daily Volume: 274,100
07/11/14 - 4:01 PM ET

Financial Analysis


WEST PHARMACEUTICAL SVSC INC's gross profit margin for the first quarter of its fiscal year 2014 has decreased when compared to the same period a year ago. Even though sales increased, the net income has decreased. WEST PHARMACEUTICAL SVSC INC has strong liquidity. Currently, the Quick Ratio is 1.93 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 25.29% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY14 Q1 FY13
Net Sales ($mil)346.8339.4
EBITDA ($mil)61.864.0
EBIT ($mil)40.043.5
Net Income ($mil)27.131.7


Balance Sheet Q1 FY14 Q1 FY13
Cash & Equiv. ($mil)230.0183.2
Total Assets ($mil)1708.21577.1
Total Debt ($mil)404.9430.1
Equity ($mil)934.6745.9


Profitability Q1 FY14 Q1 FY13
Gross Profit Margin36.9738.95
EBITDA Margin17.8218.85
Operating Margin11.5312.82
Sales Turnover0.810.82
Return on Assets6.35.27
Return on Equity11.5211.15
Debt Q1 FY14 Q1 FY13
Current Ratio3.022.83
Debt/Capital0.30.37
Interest Expense4.04.8
Interest Coverage10.09.06


Share Data Q1 FY14 Q1 FY13
Shares outstanding (mil)70.569.2
Div / share0.10.1
EPS0.380.45
Book value / share13.2610.78
Institutional Own % n/a n/a
Avg Daily Volume287193.0334385.0

Valuation


BUY. The current P/E ratio indicates a discount compared to an average of 28.51 for the Health Care Equipment & Supplies industry and a premium compared to the S&P 500 average of 19.71. To use another comparison, its price-to-book ratio of 3.23 indicates a premium versus the S&P 500 average of 2.72 and a discount versus the industry average of 4.12. The price-to-sales ratio is above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, WEST PHARMACEUTICAL SVSC 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
WST 28.39 Peers 28.51   WST 14.32 Peers 26.29

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

WST is trading at a valuation on par with 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.

WST 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
WST 20.22 Peers 20.40   WST 1.71 Peers 0.87

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

WST is trading at a premium to its peers.

 

Premium. 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.

WST trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
WST 3.23 Peers 4.12   WST 26.89 Peers 23.00

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.

WST is trading at a discount to its peers.

 

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

WST is expected to have an earnings growth rate that exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
WST 2.20 Peers 3.99   WST 6.69 Peers 5.10

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.

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

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

WST has a sales growth rate that significantly exceeds its peers.

 

 

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