Alkermes PLC

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ALKS : NASDAQ : Health Care
$44.59 up 0.42 | 0.95%
Today's Range: 44.21 - 44.52
Avg. Daily Volume: 853,900
08/26/16 - 9:52 AM ET

Financial Analysis


ALKERMES 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. The company has grown sales and net income significantly, outpacing the average growth rates of competitors within its industry. ALKERMES PLC is extremely liquid. Currently, the Quick Ratio is 3.56 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has decreased by 11.11% 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 Q2 FY16 Q2 FY15
Net Sales ($mil)195.17151.37
EBITDA ($mil)-24.03-31.9
EBIT ($mil)-47.12-52.52
Net Income ($mil)-47.19-46.11


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)655.98776.77
Total Assets ($mil)1785.291914.68
Total Debt ($mil)347.03354.81
Equity ($mil)1243.531398.99


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin86.6484.24
EBITDA Margin-12.31-21.07
Operating Margin-24.14-34.7
Sales Turnover0.370.34
Return on Assets-15.4-4.5
Return on Equity-22.11-6.16
Debt Q2 FY16 Q2 FY15
Current Ratio3.937.58
Debt/Capital0.220.2
Interest Expense3.323.32
Interest Coverage-14.18-15.84


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)151.5149.3
Div / share0.00.0
EPS-0.31-0.31
Book value / share8.219.37
Institutional Own % n/a n/a
Avg Daily Volume902367.01470619.0

Valuation


SELL. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. To use another comparison, its price-to-book ratio of 5.51 indicates a significant premium versus the S&P 500 average of 2.83 and a significant discount versus the industry average of 10.44. 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, ALKERMES 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
ALKS NM Peers 43.43   ALKS NM Peers 21.06

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.

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

 

Neutral. 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.

ALKS's P/CF is negative making the measure meaningless.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ALKS 157.12 Peers 29.93   ALKS NA Peers 0.49

Neutral. The absence of a valid price-to-projected earnings ratio happens when a stock can not be valued on the basis of a negative expected future earnings.

ALKS's ratio is negative making this valuation measure meaningless.

 

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
ALKS 5.51 Peers 10.44   ALKS -208.47 Peers 0.31

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.

ALKS 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, ALKS 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
ALKS 10.27 Peers 555.79   ALKS 3.08 Peers 52.64

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.

ALKS 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.

ALKS significantly trails its peers on the basis of sales growth

 

 

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