The timing appears opportune to go long in shares of West Pharmaceutical Services, Inc. as we anticipate another pick-up in the underlying trend.
Summary
● In a short-term perspective, the company has interesting fundamentals.
Strengths
● The company returns high margins, thereby supporting business profitability.
● There is high visibility into the group's activities for the coming years. Outlooks on future revenues from analysts covering the equity remain similar. Such hardly dispersed estimates support highly predictable sales for the current and upcoming fiscal years.
● Over the last 4 months, analysts have significantly revised upwards the company's estimated sales.
● Over the past year, analysts have regularly revised upwards their sales forecast for the company.
● For the past twelve months, EPS forecast has been revised upwards.
● For the last twelve months, analysts have been gradually revising upwards their EPS forecast for the upcoming fiscal year.
● The stock is in a well-established, long-term rising trend above the technical support level at 262.4 USD
Weaknesses
● The stock is currently in contact with a medium-term resistance that must be gotten rid of so as to resume the upward trend.
● With an expected P/E ratio at 52.15 and 47.41 respectively for both the current and next fiscal years, the company operates with high earnings multiples.
● The company is not the most generous with respect to shareholders' compensation.
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West Pharmaceutical Services, Inc. specializes in the design, manufacture and marketing of components and systems for the containment and delivery of injectable drugs. The group offers packaging, components for syringes, cartridge systems, auto-injection devices, accessories for vials, specialty components, etc. Net sales break down by family of products as follows:
- own manufactured products (81.8%);
- products manufactured under contract (18.2%).
Net sales are distributed geographically as follows: the United States (42.3%), Germany (16.8%), Ireland (8.7%), France (7.5%), Europe (12.1%) and other (12.6%).