What’s AstraZeneca’s Valuation in March 2018?
AstraZeneca (AZN) is one of the leading pharmaceutical companies worldwide. AstraZeneca is involved in discovering, developing, manufacturing, and commercializing primary care and specialty care products.
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The above chart compares revenues and earnings per share (or EPS) for AstraZeneca since 1Q16. AstraZeneca surpassed Wall Street analysts’ estimates with EPS of $1.03 on revenues of ~$5.8 billion during 4Q17 as compared to EPS estimates of $0.71 on revenues of ~$5.4 billion during 4Q17.
PE multiples represent what one share can buy for an equity investor. As of March 9, 2018, AstraZeneca (AZN) was trading at a forward PE multiple of ~19.3x as compared to the industry average of 12.9x. Some competitors like Eli Lilly (LLY), Merck (MRK), and Pfizer (PFE) are trading at a lower forward PE multiple of 15.8x, 13.0x, and 12.3x, respectively, as compared to AstraZeneca.
On a capital-structure-neutral and excess cash-adjusted basis, AstraZeneca currently trades at ~14.3x, which is higher than the industry’s average of ~10.6x as of March 9, 2018. Some competitors like Eli Lilly (LLY), Merck (MRK), and Pfizer (PFE) are trading at a lower forward EV-to-EBITDA multiple of 12.6x, 10.6x, and 10.5x, respectively, as compared to AstraZeneca.