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Aspen Pharmacare (APNHY)
:APNHY
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Aspen Pharmacare
(OTC:APNHY)
Rating:70Outperform
Price Target:
$7.00
▲(10.06% Upside)
Aspen Pharmacare (APNHY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.83B
Dividend Yield3.08%
Average Volume (3M)38.00
Price to Earnings (P/E)11.5
Beta (1Y)0.37
Revenue Growth7.29%
EPS Growth-7.24%
CountryUS
Employees8,867
SectorHealthcare
Sector Strength43
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)0.35
Shares Outstanding446,252,320
10 Day Avg. Volume74
30 Day Avg. Volume38
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.91
Enterprise Value/Revenue0.12
Enterprise Value/Gross Profit0.26
Enterprise Value/Ebitda0.50
Forecast
1Y Price Target
$7.00Price Target Upside10.06% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
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: -27.65%|
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 exhibits strong revenue growth and operational efficiency, with a solid gross profit margin. However, declining net profit margins and ROE, along with a significant drop in free cash flow, raise concerns. The company maintains a moderate leverage and strong equity position, providing financial stability, but needs to address profitability and cash flow issues.Income Statement
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.75
Positive
Balance Sheet
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.70
Positive
Cash Flow
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.68
Positive
| Breakdown | TTM | Dec 2023 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 45.52B | 40.71B | 44.71B | 38.61B | 37.77B | 38.65B |
| Gross Profit | 20.56B | 18.41B | 19.42B | 18.31B | 17.79B | 19.33B |
| EBITDA | 10.79B | 10.19B | 9.90B | 9.93B | 8.67B | 7.27B |
| Net Income | 4.48B | 5.23B | 4.40B | 6.49B | 4.81B | 4.66B |
Balance Sheet | ||||||
| Total Assets | 136.60B | 134.28B | 139.16B | 111.38B | 109.68B | 133.17B |
| Cash, Cash Equivalents and Short-Term Investments | 6.80B | 10.91B | 12.34B | 6.18B | 8.55B | 7.09B |
| Total Debt | 35.47B | 29.28B | 36.46B | 22.25B | 24.87B | 42.32B |
| Total Liabilities | 51.51B | 48.05B | 54.29B | 40.43B | 44.06B | 63.95B |
| Stockholders Equity | 85.09B | 86.24B | 84.86B | 70.94B | 65.63B | 69.22B |
Cash Flow | ||||||
| Free Cash Flow | 2.75B | 2.34B | 690.00M | 2.68B | 3.39B | 5.57B |
| Operating Cash Flow | 5.57B | 5.52B | 6.22B | 5.37B | 6.83B | 8.26B |
| Investing Cash Flow | -6.09B | -3.42B | -9.47B | -2.16B | 9.76B | 1.62B |
| Financing Cash Flow | 676.00M | -420.00M | 3.62B | -4.68B | -15.65B | -11.46B |
Aspen Pharmacare Technical Analysis
Positive
6.36
Price Trends
6.62
Positive
7.05
Negative
8.25
Negative
Market Momentum
-0.06
Positive
53.92
Neutral
60.63
Neutral
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 6.36 is below the 20-day moving average (MA) of 6.54, below the 50-day MA of 6.62, and below the 200-day MA of 8.25, indicating a neutral trend. The MACD of -0.06 indicates Positive momentum. The RSI at 53.92 is Neutral, neither overbought nor oversold. The STOCH value of 60.63 is Neutral, 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 (51)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $11.65B | 17.39 | 18.36% | 0.64% | 13.03% | -0.49% | |
70 Outperform | $2.83B | 11.55 | 5.32% | 3.08% | 7.29% | -7.24% | |
58 Neutral | $2.95B | 1,467.19 | 106.97% | ― | 9.81% | ― | |
57 Neutral | $12.46B | ― | -19.77% | 4.49% | -7.47% | -438.39% | |
55 Neutral | $19.02B | ― | -2.31% | ― | 2.43% | 64.37% | |
51 Neutral | $3.17B | ― | -1.32% | 4.92% | -2.32% | 35.46% | |
51 Neutral | $7.44B | -0.20 | -46.00% | 2.26% | 22.80% | -2.27% |
* Healthcare Sector Average
Performance Comparison
APNHY
Aspen Pharmacare
6.36
-6.35
-49.96%
RDY
Dr Reddy's Laboratories
14.11
-2.16
-13.28%
VTRS
Viatris
10.69
-0.44
-3.95%
PRGO
Perrigo Company
23.03
-3.56
-13.39%
TEVA
Teva Pharmaceutical
17.54
-0.72
-3.94%
AMRX
Amneal Pharmaceuticals
9.39
1.35
16.79%
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.