AKRX : NASDAQ : Health Care
$32.86 -0.32 | -0.96%
Today's Range: 32.81 - 33.44
Avg. Daily Volume: 1,778,300
07/26/16 - 4:00 PM ET

Financial Analysis


AKORN INC's gross profit margin for the first quarter of its fiscal year 2016 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. AKORN INC has strong liquidity. Currently, the Quick Ratio is 1.63 which shows the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 50.75% 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 FY16 Q1 FY15
Net Sales ($mil)268.35227.38
EBITDA ($mil)121.1796.12
EBIT ($mil)99.3274.72
Net Income ($mil)41.8937.54


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)145.9129.09
Total Assets ($mil)1855.851976.34
Total Debt ($mil)850.01120.91
Equity ($mil)666.59442.18


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin62.7359.45
EBITDA Margin45.1542.27
Operating Margin37.0132.86
Sales Turnover0.550.35
Return on Assets8.352.12
Return on Equity23.279.59
Debt Q1 FY16 Q1 FY15
Current Ratio2.723.54
Debt/Capital0.560.72
Interest Expense17.8314.48
Interest Coverage5.575.16


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)119.43114.33
Div / share0.00.0
EPS0.340.31
Book value / share5.583.87
Institutional Own % n/a n/a
Avg Daily Volume1785143.01789554.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 45.39 for the Pharmaceuticals industry and a value on par with the S&P 500 average of 25.05. To use another comparison, its price-to-book ratio of 5.77 indicates a significant premium versus the S&P 500 average of 2.81 and a significant discount versus the industry average of 8.86. 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, AKORN 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
AKRX 25.34 Peers 45.39   AKRX 14.82 Peers 31.23

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

AKRX is trading at a significant 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.

AKRX 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
AKRX 13.38 Peers 16.56   AKRX 0.33 Peers 0.58

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

AKRX is trading at a valuation on par with 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.

AKRX 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
AKRX 5.77 Peers 8.86   AKRX 273.52 Peers -19.27

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.

AKRX 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.

AKRX 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
AKRX 3.75 Peers 23.05   AKRX 48.31 Peers 6.33

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.

AKRX 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.

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

 

 

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