Embecta Corporation (EMBC) AI Stock Analysis

• Market Cap: $662.15M
• Dividend Yield: 5.3%
• Average Volume (3M): 620.22K
• Price to Earnings (P/E): 12.5
• Beta (1Y): 1.00
• Revenue Growth: -4.68%
• EPS Growth: -25.40%
• Country: US
• Employees: 2,000
• Sector: Healthcare
• Sector Strength: 42
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.70
• Shares Outstanding: 58,442,510
• 10 Day Avg. Volume: 505,771
• 30 Day Avg. Volume: 620,219
• PEG Ratio: -1.25
• Price to Book (P/B): -0.89
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.68
• Enterprise Value/Market Cap: 3.03
• Enterprise Value/Revenue: 0.86
• Enterprise Value/Gross Profit: 10.48
• Enterprise Value/Ebitda: 2.05
• 1Y Price Target: $17.50
• Price Target Upside: 62.79% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 53 Neutral
• Price Target: $11.00 ▲(2.33%Upside)

Embecta's overall stock score reflects significant financial challenges, including negative equity and cash flow issues. However, the company exhibits some strengths, such as a competitive dividend yield and strategic initiatives aimed at long-term growth. Technical indicators and valuation metrics suggest a cautious but potentially rewarding investment, contingent on successful execution of strategic plans and market conditions.

Positive Factors

Debt Management

A significant debt paydown of nearly $30 million in the quarter improves financial flexibility and reduces leverage.

Financial Performance

The company's EBITDA and EPS came in comfortably ahead of expectations, indicating strong financial performance.

Strategic Initiatives

Embecta is planning several strategic initiatives to transition into a broader medical supplies company and help accelerate growth beyond 2028.

Negative Factors

Market Sentiment

Buyside sentiment on EMBC remains underwhelming, largely down to lack of clarity on topline-expanding catalysts and concerns on margin compression/cash generation.

Revenue Decline

Total sales declined by 9.8% year-over-year, highlighting a challenging sales environment for the company.

Store Closures Impact

EMBC calling out major US pharmacy retailer closing stores leading to reductions of inventory levels, which will impact revenues in 2H25.

Embecta Corporation Business Overview & Revenue Model

Company Description

Embecta Corporation (EMBC) is a global medical technology company focused on providing innovative solutions for diabetes management. Specializing in the production of devices and products that aid in diabetes care, Embecta's core offerings include insulin delivery systems and related accessories. The company is dedicated to enhancing the lives of people with diabetes through advanced technology and user-friendly products.

How the Company Makes Money

Embecta Corporation generates revenue primarily through the sale of its diabetes care products, particularly insulin delivery systems, which include insulin pens, needles, and other related accessories. The company leverages its strong research and development capabilities to innovate and improve its product offerings, ensuring they meet the evolving needs of consumers and healthcare providers. Additionally, Embecta benefits from strategic partnerships and collaborations with healthcare organizations and pharmaceutical companies to expand its market reach and enhance its product distribution. Revenue is also supported through long-term contracts with healthcare institutions and distribution networks globally, ensuring a steady stream of income from its established customer base.

Embecta Corporation Financial Statement Overview

Summary

Embecta Corporation faces challenges across its financial statements. The income statement reflects shrinking margins and declining revenue growth. The balance sheet is concerning with negative equity and high leverage, while the cash flow statement highlights issues in cash generation and management. The company may need strategic adjustments to improve financial health and stability.

Income Statement

The income statement shows a declining trend in revenue from the previous annual period to the TTM, indicating some challenges in revenue generation. Gross profit margin for TTM is approximately 63.68%, which is healthy, but net profit margin has decreased to around 5.19% due to a significant drop in net income. The company has experienced shrinking EBIT and EBITDA margins, suggesting declining operating efficiency.

Balance Sheet

The balance sheet reveals potential risks with negative stockholders' equity, indicating high leverage and financial instability. The debt-to-equity ratio is not applicable due to negative equity, but the high level of total debt poses a risk. The equity ratio is negative, highlighting that liabilities exceed assets, which could be concerning for creditors and investors.

Cash Flow

Cash flow metrics indicate a reduction in operating cash flow from previous periods. The free cash flow growth rate is negative, showing a decline in cash available after capital expenditures. The operating cash flow to net income ratio is low at 0.76, suggesting inefficiencies in converting income into cash. Overall, cash flow stability seems to be compromised.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.12B	1.12B	1.13B	1.17B	1.09B
Gross Profit	735.20M	749.90M	774.90M	800.00M	762.60M
EBITDA	199.00M	245.40M	400.20M	530.00M	524.00M
Net Income	78.30M	70.40M	223.60M	414.80M	427.60M
Balance Sheet
Total Assets	1.29B	1.21B	1.09B	788.00M	738.00M
Cash, Cash Equivalents and Short-Term Investments	267.50M	326.50M	330.90M	0.00	0.00
Total Debt	1.61B	1.64B	1.64B	4.00M	5.00M
Total Liabilities	2.02B	2.04B	1.98B	194.00M	166.00M
Stockholders Equity	-738.30M	-821.70M	-891.40M	594.00M	572.00M
Cash Flow
Free Cash Flow	19.90M	41.20M	388.20M	417.00M	456.60M
Operating Cash Flow	35.70M	67.70M	412.20M	456.00M	498.50M
Investing Cash Flow	-15.80M	-26.50M	-24.00M	-39.00M	-41.90M
Financing Cash Flow	-73.40M	-48.70M	-48.00M	-417.00M	-456.60M

Embecta Corporation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 10.75
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EMBC, the sentiment is Neutral. The current price of 10.75 is above the 20-day moving average (MA) of 10.51, above the 50-day MA of 10.41, and below the 200-day MA of 13.90, indicating a neutral trend. The MACD of 0.24 indicates Negative momentum. The RSI at 52.05 is Neutral, neither overbought nor oversold. The STOCH value of 76.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EMBC.

Embecta Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SUPN	71 Outperform	$1.87B	30.29	6.32%	―	11.82%	―
ANIP	69 Neutral	$1.44B	―	-5.19%	―	30.26%	-173.36%
HROW	61 Neutral	$1.28B	―	-37.23%	―	53.49%	33.18%
AVDL	60 Neutral	$1.05B	―	-34.65%	―	252.64%	85.10%
EMBC	53 Neutral	$662.15M	12.50	-10.61%	5.30%	-4.68%	-25.40%
DVAX	53 Neutral	$1.36B	64.45	-10.45%	―	24.76%	-783.38%
Sector *	52 Neutral	kr5.61B	10.15	-63.86%	2.10%	27.11%	26.73%

Embecta Corporation Corporate Events

Embecta Unveils Strategy at Analyst and Investor Day

On May 22, 2025, Embecta Corp. hosted its first Analyst and Investor Day to present its phased strategy for value creation and long-term financial plans. The company aims to strengthen its core insulin business, expand its product portfolio, and increase financial flexibility. Embecta reaffirmed its fiscal year 2025 financial guidance and announced a long-range financial plan through fiscal 2028, focusing on maintaining revenue, achieving an adjusted operating margin, and reducing debt. These initiatives are designed to position Embecta for sustainable growth in the evolving healthcare landscape.

The most recent analyst rating on (EMBC) stock is a Sell with a $20.00 price target. To see the full list of analyst forecasts on Embecta Corporation stock, see the EMBC Stock Forecast page.