Allergan PLC

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AGN : NYSE : Health Care
$238.75 -5.20 | -2.10%
Today's Range: 238.27 - 242.62
Avg. Daily Volume: 3,079,200
09/26/16 - 3:59 PM ET

Financial Analysis


ALLERGAN PLC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. ALLERGAN PLC has very weak liquidity. Currently, the Quick Ratio is 0.34 which clearly shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 6.34% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)3684.83628.7
EBITDA ($mil)1857.01905.4
EBIT ($mil)189.1314.4
Net Income ($mil)-501.7-243.1


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)506.61526.4
Total Assets ($mil)132619.1138411.1
Total Debt ($mil)39581.742870.3
Equity ($mil)76643.972069.1


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin88.9290.33
EBITDA Margin50.3952.5
Operating Margin5.138.66
Sales Turnover0.120.07
Return on Assets3.33-1.82
Return on Equity-3.16-4.88
Debt Q2 FY16 Q2 FY15
Current Ratio0.991.37
Debt/Capital0.340.37
Interest Expense345.8339.9
Interest Coverage0.550.93


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)395.8393.1
Div / share0.00.0
EPS-1.25-1.38
Book value / share193.64183.34
Institutional Own % n/a n/a
Avg Daily Volume3086780.05237629.0

Valuation


HOLD. This stock’s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. For additional comparison, its price-to-book ratio of 1.26 indicates a significant discount versus the S&P 500 average of 2.82 and a significant discount versus the industry average of 19.66. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. After reviewing these and other key valuation criteria, ALLERGAN PLC 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
AGN NM Peers 29.47   AGN 18.51 Peers 20.98

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

AGN's P/E is negative making this valuation measure meaningless.

 

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.

AGN is trading at a 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
AGN 14.33 Peers 15.05   AGN NA Peers 0.54

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

AGN is trading at a premium to its peers.

 

Neutral. 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.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AGN 1.26 Peers 19.66   AGN 50.33 Peers -20.56

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.

AGN is trading at a significant discount to its peers.

 

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

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

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AGN 6.27 Peers 12.73   AGN 51.01 Peers 5.56

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.

AGN 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.

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

 

 

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