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Roche Holding (CH:ROG)
:ROG
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Roche Holding AG (ROG) AI Stock Analysis

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CH:ROG

Roche Holding AG

(OTC:ROG)

Rating:71Outperform
Price Target:
CHF288.00
▲(11.11%Upside)
Roche's overall stock score reflects its solid financial performance, driven primarily by strong cash flow and effective cost management. The positive sentiment from the recent earnings call further boosts confidence, particularly with new product approvals and pipeline expansion. Technical analysis presents some caution with bearish momentum indicators, while valuation is slightly high but supported by a strong dividend yield. Despite challenges in certain segments, Roche's strategic growth drivers and financial stability position it well in the industry.
Positive Factors
Investment and Expansion
Roche announced a $50 billion investment in the US for Pharma and diagnostics over the next five years, including research and development sites and new manufacturing facilities.
Market Share
Roche continues to take market share in the US across various indications with increasing percentages.
Pharmaceutical Sales
Key drivers of the Pharma sales beat include Hemlibra, Xolair, and Actemra, which were ahead by 12%, 19%, and 14% respectively.
Negative Factors
Diagnostics Performance
Performance in diagnostics was weaker than expected with a 4% miss.
Earnings Growth Outlook
The mid-term earnings growth outlook for Roche is projected at 4%, which is lower compared to sector peers at 8%.
Sales Growth
A more challenging US market for Vabysmo drives FY25 sales growth closer to 18% YoY, compared to the pre-Q1 consensus of around 33% growth.

Roche Holding AG (ROG) vs. iShares MSCI Switzerland ETF (EWL)

Roche Holding AG Business Overview & Revenue Model

Company DescriptionRoche Holding AG is a global healthcare company based in Switzerland, renowned for its innovative contributions to the fields of pharmaceuticals and diagnostics. The company operates in two main divisions: Pharmaceuticals and Diagnostics. In the Pharmaceuticals division, Roche focuses on developing and manufacturing medicines for various therapeutic areas, including oncology, immunology, infectious diseases, ophthalmology, and diseases of the central nervous system. The Diagnostics division provides a wide range of diagnostic tests and equipment for healthcare professionals, laboratories, and patients, enabling enhanced disease prevention, diagnosis, and treatment.
How the Company Makes MoneyRoche Holding AG generates revenue primarily through its two main business segments: Pharmaceuticals and Diagnostics. The Pharmaceuticals division is the largest revenue generator, with income derived from the research, development, production, and sale of prescription medicines, particularly in oncology, where Roche is a market leader. The company invests heavily in research and development to sustain its pipeline of innovative drugs and maintain patent protection, which allows for premium pricing. The Diagnostics division contributes to revenue by offering a broad portfolio of diagnostic solutions, including in vitro diagnostics, tissue-based cancer diagnostics, and clinical laboratory tests. Roche's diagnostic products support healthcare providers in disease detection and management, thereby driving sales. Additionally, strategic partnerships and collaborations with other healthcare and biotech companies, as well as an expansive global distribution network, further bolster Roche's revenue streams.

Roche Holding AG Earnings Call Summary

Earnings Call Date:Jul 24, 2025
(Q4-2024)
|
% Change Since: -0.80%|
Next Earnings Date:Jan 29, 2026
Earnings Call Sentiment Positive
Roche demonstrated strong financial performance in 2024 with significant growth in sales, operating profit, and cash flow. The pharmaceutical and diagnostics divisions both showed robust growth, supported by strategic acquisitions and new product launches. However, challenges such as the decline in COVID-19 sales, impairments affecting net income, and market challenges in China were notable concerns. Overall, the highlights substantially outweigh the lowlights.
Q4-2024 Updates
Positive Updates
Strong Financial Performance
Group sales grew 7%, with the base business growing 9%, pharma 9%, and diagnostics 8%. Core operating profit increased by 14%, with a core operating margin up 2.1 percentage points. Operating free cash flow increased by 34% to CHF21.2 billion.
Pharmaceutical Achievements
Pharma sales grew 8% to CHF46.2 billion, driven by Vabysmo, Phesgo, and Ocrevus, among others. The company launched two new medicines, PiaSky and Itovebi, in 2024.
Diagnostics Growth
Diagnostics division reported 4% sales growth, with a strong base business growth of 8% driven by immunodiagnostics and clinical chemistry.
Pipeline and Product Launches
Roche achieved several key milestones, including EU approval for Vabysmo pre-filled syringe and positive readouts for trontinemab and NXT007. Launches included Mass Spectrometry system and cobas 6800/8800 version 2.
Strategic Acquisitions and Partnerships
Acquisition of Poseida to expand the allogeneic CAR-T portfolio, introducing potential treatments for oncology and autoimmune diseases.
Negative Updates
COVID-19 Sales Decline
Final impact of COVID-19 sales reduction in 2024 amounted to CHF1.1 billion, aligning with guidance but marking the end of a significant revenue stream.
Challenges in China
Diagnostics sales in China were impacted by volume-based procurement and reimbursement reductions, leading to a lower growth projection for 2025.
Impairments Affecting Net Income
IFRS net income decreased by 19% due to two major impairments totaling CHF3.9 billion, reflecting unmet expectations of acquired assets.
Patent and Biosimilar Concerns
Continued concern over patent expirations and biosimilar competition, notably impacting Actemra and Ocrevus in the future.
Company Guidance
During the call, Roche Group provided detailed guidance on its fiscal 2024 performance, highlighting several key metrics. The company achieved an overall group sales growth of 7%, with the base business excluding COVID-19 impacts growing by an impressive 9%. The pharmaceutical division reported a 9% increase, and the diagnostics division saw an 8% rise. Roche confirmed that the final impact of COVID-19 sales reduction was CHF1.1 billion, aligning with their initial guidance. The loss of exclusivity (LOE) impact was CHF1 billion, slightly better than expected. The core operating profit grew by 14%, and the group core operating margin increased by 2.1 percentage points. Additionally, core EPS growth was 12%, excluding tax effects, or 7% when including them. Operating free cash flow surged by 34% to CHF21.2 billion, reflecting strong financial health. Looking forward, Roche anticipates mid-single digit group sales growth and high-single digit core EPS growth for 2025, despite an expected LOE impact of CHF1.2 billion. The company also plans to continue its tradition of increasing dividends, marking the 38th consecutive year of growth in this area.

Roche Holding AG Financial Statement Overview

Summary
Roche Holding AG shows solid financial health with strong cash flow and stable income metrics. However, declining net profit margin and return on equity indicate potential profitability pressures.
Income Statement
75
Positive
Roche Holding AG's income statement shows a stable gross profit margin of approximately 74% for 2024. However, the net profit margin decreased from 19% in 2023 to 13% in 2024, indicating a reduction in profitability. Revenue growth was modest at 3.2% in 2024 compared to 2023, and EBIT margin also declined to 21.5% from 25.5% in 2023. EBITDA margin remains strong at 26.6% but has decreased from previous years. Overall, the company maintains strong profitability metrics, although there are signs of margin pressure.
Balance Sheet
70
Positive
The balance sheet reflects a debt-to-equity ratio of 1.14 in 2024, indicating moderate leverage. Return on equity stands at 26%, which is a decline from 39% in 2023, suggesting reduced efficiency in using equity to generate profits. Equity ratio improved to 31.2% from 32.4% in 2023, indicating a slight improvement in asset financing through equity. While the company remains financially stable, the decline in ROE is a concern.
Cash Flow
80
Positive
Roche's cash flow statement shows strong free cash flow generation with a growth rate of 31.8% in 2024. Operating cash flow to net income ratio is robust at 2.43, reflecting strong cash earnings relative to net income. Free cash flow to net income ratio also improved to 1.82, indicating efficient cash utilization. These metrics suggest excellent cash flow management despite the decline in net income.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue62.40B60.44B63.28B62.80B58.32B
Gross Profit46.11B44.08B44.44B43.10B41.97B
EBITDA16.62B18.41B20.80B22.19B22.97B
Net Income8.28B11.50B12.42B13.93B14.29B
Balance Sheet
Total Assets101.80B90.47B88.15B92.32B86.14B
Cash, Cash Equivalents and Short-Term Investments17.32B10.51B9.77B13.03B12.33B
Total Debt36.35B30.78B26.54B32.55B15.41B
Total Liabilities65.64B57.20B56.14B63.97B46.37B
Stockholders Equity31.77B29.32B27.99B24.49B36.34B
Cash Flow
Free Cash Flow15.09B11.45B13.34B16.02B11.47B
Operating Cash Flow20.09B16.09B17.89B20.57B18.16B
Investing Cash Flow-11.39B-10.64B-3.57B-6.55B-9.08B
Financing Cash Flow-6.82B-4.24B-15.72B-12.70B-9.24B

Roche Holding AG Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price259.20
Price Trends
50DMA
261.36
Negative
100DMA
268.02
Negative
200DMA
264.64
Negative
Market Momentum
MACD
-0.40
Negative
RSI
51.26
Neutral
STOCH
59.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:ROG, the sentiment is Neutral. The current price of 259.2 is above the 20-day moving average (MA) of 258.67, below the 50-day MA of 261.36, and below the 200-day MA of 264.64, indicating a neutral trend. The MACD of -0.40 indicates Negative momentum. The RSI at 51.26 is Neutral, neither overbought nor oversold. The STOCH value of 59.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CH:ROG.

Roche Holding AG Peers Comparison

Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
CHF17.43B45.09
0.87%3.82%57.08%
75
Outperform
CHF177.65B15.61
3.75%9.36%-14.82%
73
Outperform
CHF36.34B36.225.23%<0.01%3.90%6.76%
71
Outperform
CHF210.23B22.0031.98%3.72%4.77%-11.07%
71
Outperform
CHF31.95B97.34
0.11%6.22%
69
Neutral
CHF38.62B53.33
0.71%5.93%29.83%
50
Neutral
AU$2.64B3.32-57.47%2.62%36.37%14.48%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CH:ROG
Roche Holding AG
260.60
-15.76
-5.70%
CH:NOVN
Novartis AG
93.34
-1.74
-1.83%
CH:LONN
Lonza Group Ltd
565.20
-9.58
-1.67%
CH:STMN
Straumann Holding AG
108.70
-3.42
-3.05%
CH:ALC
Alcon
72.72
-9.91
-11.99%
CH:GALD
Galderma Group AG
133.70
65.83
96.99%
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 29, 2025