Aspen Pharmacare (APNHY) AI Stock Analysis

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Aspen Pharmacare

(OTC:APNHY)

Rating:73Outperform

Price Target:

$7.50

▲(10.62%Upside)

Aspen Pharmacare's strong earnings call highlights, including significant revenue and EBITDA growth, play a major role in its overall score. While robust financial performance supports the company's stability, technical analysis indicates a bearish trend, and valuation is reasonable. The absence of notable corporate events further solidifies this score.

Aspen Pharmacare (APNHY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.07B

Dividend Yield0.27%

Average Volume (3M)11.00

Price to Earnings (P/E)12.2

Beta (1Y)0.36

Revenue Growth7.29%

EPS Growth-7.24%

CountryUS

Employees8,867

SectorHealthcare

Sector Strength37

IndustryDrug Manufacturers - Specialty & Generic

Share Statistics

EPS (TTM)0.35

Shares Outstanding446,252,320

10 Day Avg. Volume0

30 Day Avg. Volume11

Financial Highlights & Ratios

PEG Ratio6.51

Price to Book (P/B)0.59

Price to Sales (P/S)0.00

P/FCF Ratio18.18

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$7.50

Price Target Upside10.62% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering0

Aspen Pharmacare Business Overview & Revenue Model

Company DescriptionAspen Pharmacare Holdings Limited, together with its subsidiaries, manufactures and supplies specialty and branded pharmaceutical products worldwide. It operates in Commercial Pharmaceuticals and Manufacturing segments. The company provides general anesthetics, muscle relaxants, and topical agents under the Anaesthetics brand; and a range of injectable anticoagulants with a focus on low molecular weight heparins, Xa inhibitors, and heparin derivatives under the Thrombosis brand. It also offers branded consumer, prescription, and over-the-counter products under the regional brands, such as Circadin, Foxair, Maltofer, Mybulen, and Zyloric for various types of anesthetic comprises sleeping aid, respiratory, iron supplement, analgesic, and uric acid production inhibitor. In addition, the company manufactures and sells active pharmaceutical ingredients and finished dose form products to third-party customers. The company was founded in 1850 and is headquartered in Durban, South Africa.

How the Company Makes MoneyAspen Pharmacare generates revenue through the manufacture and sale of a wide range of pharmaceutical products. The company's primary revenue streams include its commercial pharmaceuticals, which encompass branded products and generics, and its manufacturing business that provides APIs and pharmaceutical finished dose forms to third parties. Aspen's earnings are bolstered by strategic partnerships and collaborations with other pharmaceutical companies, enabling it to expand its global reach and enhance its product offerings. Additionally, the company benefits from its cost-effective manufacturing capabilities and a strong presence in both emerging and established markets, which contribute significantly to its revenue growth.

Aspen Pharmacare Earnings Call Summary

Earnings Call Date:Mar 03, 2025

(Q2-2025)

% Change Since: -22.87%|

Next Earnings Date:Sep 03, 2025

Earnings Call Sentiment Neutral

Aspen's earnings call highlighted significant achievements, particularly in revenue and EBITDA growth, successful acquisitions, and promising opportunities in the GLP-1 market. However, challenges such as currency impacts, difficulties in China, and increased tax and working capital levels posed notable concerns.

Q2-2025 Updates

Positive Updates

Strong Revenue Growth

Aspen reported a 9% revenue growth at constant exchange rates (CER) and 4% in reported terms, highlighting a robust performance despite currency fluctuations.

Normalized EBITDA Surge

Normalized EBITDA increased by 21% at CER and 12% in reported terms, significantly outpacing revenue growth and demonstrating strong operational efficiency.

Commercial Pharma Performance

The Commercial Pharma segment achieved double-digit growth with revenue and EBITDA both increasing. The segment is derisked from major market headwinds, such as China VBP and Russia.

Successful LatAm Acquisition

The acquisition in Latin America was executed seamlessly, achieving over 100% of expected sales, marking a significant milestone for Aspen in the region.

GLP-1 Opportunity

Aspen is well-positioned in the GLP-1 market, with submissions underway and positive feedback from stringent regulators, marking a transformative opportunity for the company.

Sustainability Initiatives

Aspen outlined ambitious sustainability goals, including reducing carbon emissions by 50% by 2030 and achieving gender balance in top management.

Negative Updates

Currency Impact

Currency fluctuations had a significant negative impact, with a ZAR 900 million reduction in EBITDA when restating at constant exchange rates.

Challenges in China

The business environment in China remains difficult, leading to a larger-than-anticipated restructuring that will be fully implemented by the end of the next month.

Elevated Tax Rate

The effective tax rate increased to 21.6% due to higher sterile mix and the retroactive implementation of BEPS Pillar 2 legislation.

Working Capital Increase

Working capital increased to 50% of revenue, impacted by seasonal inventory buildup and the integration of Sandoz China.

Company Guidance

During the call, Aspen provided guidance for fiscal year 2025 with several key metrics. The company reported a 9% increase in revenue in constant currency and a 21% growth in normalized EBITDA at constant exchange rates, significantly surpassing revenue growth. The Commercial Pharma segment achieved double-digit growth in both revenue and EBITDA, while the Manufacturing segment saw a 65% increase in finished dose form (FDF) growth. Aspen also projected double-digit compound annual growth in EBITDA and forecasted operating cash flow conversion rates to exceed 100%. Additionally, the company highlighted its focus on the GLP-1 opportunity, anticipating first revenues in financial year 2026, with a strong contribution to future growth. The Finance cost effective interest rate was noted at approximately 5%, and the tax rate increased to 21.6%. Aspen's operating cash flow was expected to improve, targeting a working capital to revenue ratio of 45% by year-end.

Aspen Pharmacare Financial Statement Overview

Summary

Aspen Pharmacare demonstrates strong revenue growth and operational efficiency, with a high gross profit margin. However, declining net profit margins and ROE, along with a significant drop in free cash flow, raise concerns about profitability and cash flow sustainability. The company maintains financial stability through moderate leverage and a strong equity position.

Income Statement

Positive

Aspen Pharmacare has shown a consistent increase in revenue over the years, with a revenue growth rate of 9.82% from 2023 to 2024. The gross profit margin stands at 43.44%, indicating strong profitability. However, the net profit margin has decreased to 9.85% in 2024, reflecting a decline in net income. The EBIT margin is 15.65%, and the EBITDA margin is 22.16%, both of which suggest healthy operational efficiency despite some decline in EBIT.

Balance Sheet

Positive

The company's debt-to-equity ratio is 0.43, indicating a moderate level of leverage. The return on equity (ROE) has decreased to 5.19%, which is a concern for investor returns. The equity ratio is 60.98%, showing a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Positive

Aspen Pharmacare's free cash flow has decreased significantly, with a negative growth rate of -70.50% from 2023 to 2024. The operating cash flow to net income ratio is 1.41, indicating good cash generation relative to net income. However, the free cash flow to net income ratio has dropped to 0.16, highlighting challenges in maintaining free cash flow levels.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	44.71B	40.71B	38.61B	37.77B	38.65B
Gross Profit	19.42B	18.41B	18.31B	17.79B	19.33B
EBITDA	9.90B	9.50B	10.48B	8.67B	7.27B
Net Income	4.40B	5.23B	6.49B	4.81B	4.66B
Balance Sheet
Total Assets	139.16B	134.28B	111.38B	109.68B	133.17B
Cash, Cash Equivalents and Short-Term Investments	12.34B	10.91B	6.18B	8.55B	7.09B
Total Debt	36.46B	29.28B	22.25B	24.87B	42.32B
Total Liabilities	54.29B	48.05B	40.43B	44.06B	63.95B
Stockholders Equity	84.86B	86.24B	70.94B	65.63B	69.22B
Cash Flow
Free Cash Flow	690.00M	2.34B	2.68B	3.39B	5.57B
Operating Cash Flow	6.22B	5.52B	5.37B	6.83B	8.26B
Investing Cash Flow	-9.47B	-3.42B	-2.16B	9.76B	1.62B
Financing Cash Flow	3.62B	-420.00M	-4.68B	-15.65B	-11.46B

Aspen Pharmacare Technical Analysis

Technical Analysis Sentiment

Positive

Last Price6.78

Price Trends

50DMA

6.68

Positive

100DMA

7.48

Negative

200DMA

8.53

Negative

Market Momentum

MACD

>-0.01

Negative

RSI

54.84

Neutral

STOCH

92.71

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APNHY, the sentiment is Positive. The current price of 6.78 is above the 20-day moving average (MA) of 6.60, above the 50-day MA of 6.68, and below the 200-day MA of 8.53, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 54.84 is Neutral, neither overbought nor oversold. The STOCH value of 92.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for APNHY.

Aspen Pharmacare Peers Comparison

Overall Rating

UnderperformOutperform

Sector (46)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
APNHY	73 Outperform	$3.07B	12.23	5.32%	0.27%	7.29%	-7.24%
RDY	71 Outperform	$12.20B	18.26	18.36%	0.03%	13.03%	-0.49%
PRGO	63 Neutral	$3.86B	―	-3.64%	4.03%	-4.85%	-4290.31%
AMRX	56 Neutral	$2.51B	―	106.97%	―	13.42%	92.50%
TEVA	55 Neutral	$19.15B	―	-18.98%	―	3.38%	-175.90%
VTRS	54 Neutral	$11.00B	―	-21.25%	5.12%	-6.88%	-6809.78%
Sector *	46 Neutral	C$201.68M	-3.28	-23.14%	1.87%	20.75%	-0.36%

* Healthcare Sector Average

Performance Comparison

APNHY

Aspen Pharmacare

6.78

-6.27

-48.05%

RDY

Dr Reddy's Laboratories

14.67

-1.41

-8.77%

VTRS

Viatris

9.41

-2.13

-18.46%

PRGO

Perrigo Company

28.43

1.43

5.30%

TEVA

Teva Pharmaceutical

16.54

-0.56

-3.27%

AMRX

Amneal Pharmaceuticals

8.06

0.62

8.33%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025