West Pharmaceutical Services Inc
Find Ratings ReportsWEST PHARMACEUTICAL SVSC INC's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged 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. WEST PHARMACEUTICAL SVSC INC has strong liquidity. Currently, the Quick Ratio is 1.54 which shows the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.
During the same period, stockholders' equity ("net worth") has increased by 8.80% 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 FY17 | Q1 FY16 |
|---|---|---|
| Net Sales ($mil) | 387.7 | 362.1 |
| EBITDA ($mil) | 85.5 | 78.1 |
| EBIT ($mil) | 62.2 | 55.8 |
| Net Income ($mil) | 60.9 | 22.1 |
| Balance Sheet | Q1 FY17 | Q1 FY16 |
|---|---|---|
| Cash & Equiv. ($mil) | 169.4 | 178.1 |
| Total Assets ($mil) | 1733.5 | 1668.2 |
| Total Debt ($mil) | 228.6 | 232.0 |
| Equity ($mil) | 1168.6 | 1074.0 |
| Profitability | Q1 FY17 | Q1 FY16 |
|---|---|---|
| Gross Profit Margin | 40.6 | 40.21 |
| EBITDA Margin | 22.05 | 21.56 |
| Operating Margin | 16.04 | 15.41 |
| Sales Turnover | 0.89 | 0.85 |
| Return on Assets | 10.52 | 5.08 |
| Return on Equity | 15.6 | 7.89 |
| Debt | Q1 FY17 | Q1 FY16 |
|---|---|---|
| Current Ratio | 2.54 | 2.62 |
| Debt/Capital | 0.16 | 0.18 |
| Interest Expense | 2.7 | 3.2 |
| Interest Coverage | 23.04 | 17.44 |
| Share Data | Q1 FY17 | Q1 FY16 |
|---|---|---|
| Shares outstanding (mil) | 73.6 | 73.08 |
| Div / share | 0.13 | 0.12 |
| EPS | 0.81 | 0.3 |
| Book value / share | 15.88 | 14.7 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 354739.0 | 336194.0 |
BUY. WEST PHARMACEUTICAL SVSC INC's P/E ratio indicates a discount compared to an average of 43.59 for the Health Care Equipment & Supplies industry and a significant premium compared to the S&P 500 average of 25.73. Conducting a second comparison, its price-to-book ratio of 6.06 indicates a significant premium versus the S&P 500 average of 3.08 and a premium versus the industry average of 4.97. The current price-to-sales ratio is well above the S&P 500 average, but below the industry average. The valuation analysis reveals that, WEST PHARMACEUTICAL SVSC INC seems to be trading at a discount to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| WST 39.60 | Peers 43.59 | WST 29.69 | Peers 27.54 | |||||||||||||||||||||
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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. |
Average. 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 valuation on par to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
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| WST 32.08 | Peers 24.69 | WST 0.91 | Peers 0.97 | |||||||||||||||||||||
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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 significant premium to its peers. |
Average. 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 valuation on par to its peers. |
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| Price/Book |
|
Earnings Growth |
|
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| WST 6.06 | Peers 4.97 | WST 111.30 | Peers 116.03 | |||||||||||||||||||||
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Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. WST is trading at a premium to its peers. |
Average. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. WST is expected to keep pace with its peers on the basis of earnings growth. |
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| Price/Sales |
|
Sales Growth |
|
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| WST 4.62 | Peers 5.06 | WST 7.62 | Peers 14.46 | |||||||||||||||||||||
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Average. 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 valuation on par with its industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. WST significantly trails its peers on the basis of sales growth |
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