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Hikma Pharmaceuticals PLC (GB:HIK)
LSE:HIK

Hikma Pharmaceuticals (HIK) AI Stock Analysis

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GB

Hikma Pharmaceuticals

(LSE:HIK)

Rating:75Outperform
Price Target:
2,345.00p
▲( 12.85% Upside)
Hikma Pharmaceuticals is positioned well with strong financial health and strategic corporate actions supporting its outlook. The stock's valuation is reasonable, providing a good entry point for long-term investors. However, technical analysis suggests cautious optimism due to current market momentum challenges. The overall score reflects the company's robust financial foundation, strategic initiatives, and reasonable valuation, balanced by technical market conditions.
Positive Factors
Earnings Guidance
Hikma's trading update sees the business on track for its unchanged FY25 guidance and current market expectations.
Investments and Opportunities
A market overreaction has created an opportunity for investors, as recent macro tariff news has inappropriately affected Hikma, exposing both short- and long-term opportunity.
Market Demand
Strong demand in European and MENA markets, while North America benefitting from good demand for the recently launched liraglutide injection and the contribution from the newly acquired Xellia portfolio.
Negative Factors
Interest Charges
A 2% reduction to FY25 core EBIT and 5% reduction to adj. EPS also reflecting higher interest charges.
Margin Impact
Phasing and mix of sales expected to impact margins in 1H, but FY25 core operating margin maintained in the mid-30s.

Hikma Pharmaceuticals (HIK) vs. iShares MSCI United Kingdom ETF (EWC)

Hikma Pharmaceuticals Business Overview & Revenue Model

Company DescriptionHikma Pharmaceuticals PLC develops, manufactures, markets, and sells a range of generic, branded, and in-licensed pharmaceutical products. The company offers its products in solid, semi-solid, liquid, and injectable final dosage forms. It operates through three segments: Injectables, Generics, and Branded. The Injectables segment provides generic injectable products primarily for use in hospitals. The Generics segment offers oral and other non-injectable generic products for the retail market. The Branded segment offers branded generics and in-licensed products to retail and hospital markets. The company provides its products in various therapeutic areas, including anti-infective, cardiovascular, central nervous system, diabetes, oncology, pain management, and respiratory. It operates in the United Kingdom, the United States, the Middle East, North Africa, Europe, and internationally. The company was founded in 1978 and is based in London, the United Kingdom.
How the Company Makes MoneyHikma Pharmaceuticals generates revenue through the sale of its pharmaceutical products across three main segments: branded, injectables, and generics. The branded segment focuses on proprietary products sold primarily in the Middle East and North Africa. The injectables segment involves the production and sale of injectable medicines, which are distributed to hospitals and healthcare facilities globally. The generics segment offers non-branded generic drugs, mainly targeting the US market. Hikma's revenue model is supported by strategic partnerships, research and development investments, and a diverse portfolio of pharmaceutical products that cater to different therapeutic areas. Additionally, Hikma capitalizes on its strong distribution network and manufacturing capabilities to ensure efficient product delivery and market penetration.

Hikma Pharmaceuticals Financial Statement Overview

Summary
Hikma Pharmaceuticals demonstrates strong financial health with steady revenue and profit growth, robust profit margins, and efficient cash flow management. The income statement shows an impressive revenue growth of 8.77% and improved net profit margins. The balance sheet is stable with a moderate debt-to-equity ratio of 0.57, and the cash flow remains strong despite a slight decrease in free cash flow.
Income Statement
85
Very Positive
Hikma Pharmaceuticals shows strong financial performance with a consistent growth trajectory. The revenue growth rate stands at 8.77% from 2023 to 2024, driven by increases in both gross and net profit margins. The gross profit margin for 2024 is robust at 45.25%, while the net profit margin improved to 11.48% from the previous year's 6.61%. Both EBIT and EBITDA margins are healthy, indicating operational efficiency and profitability.
Balance Sheet
78
Positive
The balance sheet reflects a stable financial position with a sound equity base. The debt-to-equity ratio is 0.57, indicating moderate leverage. The equity ratio is 44.98%, suggesting a solid proportion of assets financed by equity. Return on Equity (ROE) is improving at 15.54% for 2024, highlighting effective use of equity in generating profit.
Cash Flow
72
Positive
Cash flow analysis reveals strong operational cash flow with an operating cash flow to net income ratio of 1.57 for 2024, demonstrating efficient cash conversion from earnings. Free cash flow has decreased slightly by 9.11% from 2023 but remains positive, underscoring sufficient cash generation after capital expenditures. The free cash flow to net income ratio is 1.11, showing adequate free cash flow in relation to net income.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
3.13B2.88B2.52B2.55B2.34B
Gross Profit
1.42B1.41B1.26B1.30B1.21B
EBIT
612.00M367.00M591.00M634.00M540.00M
EBITDA
787.00M791.00M485.00M744.00M654.00M
Net Income Common Stockholders
359.00M190.00M188.00M421.00M431.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
213.00M229.00M292.00M450.00M347.00M
Total Assets
5.13B4.68B4.47B4.37B4.13B
Total Debt
1.31B1.19B1.28B846.00M932.00M
Net Debt
1.12B986.00M1.01B420.00M609.00M
Total Liabilities
2.81B2.47B2.32B1.91B1.99B
Stockholders Equity
2.31B2.20B2.13B2.45B2.13B
Cash FlowFree Cash Flow
399.00M439.00M392.00M493.00M292.00M
Operating Cash Flow
564.00M608.00M530.00M638.00M464.00M
Investing Cash Flow
-381.00M-333.00M-607.00M-238.00M-283.00M
Financing Cash Flow
-188.00M-337.00M-58.00M-287.00M-298.00M

Hikma Pharmaceuticals Technical Analysis

Technical Analysis Sentiment
Positive
Last Price2078.00
Price Trends
50DMA
1964.97
Positive
100DMA
2048.30
Positive
200DMA
1972.23
Positive
Market Momentum
MACD
31.29
Negative
RSI
63.32
Neutral
STOCH
80.07
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HIK, the sentiment is Positive. The current price of 2078 is above the 20-day moving average (MA) of 1993.60, above the 50-day MA of 1964.97, and above the 200-day MA of 1972.23, indicating a bullish trend. The MACD of 31.29 indicates Negative momentum. The RSI at 63.32 is Neutral, neither overbought nor oversold. The STOCH value of 80.07 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HIK.

Hikma Pharmaceuticals Peers Comparison

Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
£176.60M4.8633.70%1.95%-0.17%2591.96%
GBHLN
78
Outperform
£36.84B25.908.80%1.61%-0.61%39.00%
GBHIK
75
Outperform
£4.57B16.3415.79%2.98%5.83%83.35%
GBAPH
59
Neutral
$355.92M-5.04%-1.02%67.70%
53
Neutral
$5.24B3.07-43.58%2.80%16.87%-0.11%
GBAGY
48
Neutral
£338.42M-369.20%4.50%74.32%
GBBXP
$39.57B3.7413.12%5.94%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:HIK
Hikma Pharmaceuticals
2,078.00
176.79
9.30%
GB:AGY
Allergy Therapeutics
7.00
3.60
105.88%
GB:APH
Alliance Pharma
64.70
26.10
67.62%
GB:ANCR
Animalcare
255.00
16.01
6.70%
GB:BXP
Beximco Pharmaceuticals Limited Sponsored GDR RegS
36.00
-1.91
-5.04%
GB:HLN
Haleon PLC
413.70
90.51
28.01%

Hikma Pharmaceuticals Corporate Events

Private Placements and FinancingBusiness Operations and Strategy
Hikma Pharmaceuticals Executives Involved in Share Pledge Transactions
Neutral
May 20, 2025

Hikma Pharmaceuticals PLC has disclosed transactions involving its senior executives, including Executive Chairman Said Darwazah, Executive Vice Chairman Mazen Darwazah, and Non-Executive Director Ali Al-Husry. These transactions involve the grant of a pledge by Darhold Limited over 430,000 ordinary shares of Hikma Pharmaceuticals in favor of EFG International Bank. This move, involving key figures within the company, could have implications for the company’s financial strategies and stakeholder interests.

The most recent analyst rating on (GB:HIK) stock is a Buy with a £2500.00 price target. To see the full list of analyst forecasts on Hikma Pharmaceuticals stock, see the GB:HIK Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Hikma Pharmaceuticals Projects Strong Growth and Rebrands Generics Business
Positive
May 15, 2025

Hikma Pharmaceuticals announced strong medium-term growth guidance for its Group, projecting a 6% to 8% CAGR in revenue and a 7% to 9% CAGR in core operating profit from 2024 to 2027. The company aims to achieve $5 billion in Group revenue by 2030 and is rebranding its Generics business to Hikma Rx, emphasizing its focus on complex prescription medicines. This strategic move and growth projection highlight Hikma’s commitment to sustainable growth and its significant role in the US generic medicines market.

The most recent analyst rating on (GB:HIK) stock is a Buy with a £2500.00 price target. To see the full list of analyst forecasts on Hikma Pharmaceuticals stock, see the GB:HIK Stock Forecast page.

DividendsBusiness Operations and Strategy
Hikma Pharmaceuticals Executives Acquire Shares Under DRIP
Positive
May 8, 2025

Hikma Pharmaceuticals announced that several of its Persons Discharging Managerial Responsibility (PDMRs) acquired ordinary shares in the company through a dividend reinvestment plan. This acquisition, involving key figures such as CEO Riad Mishlawi, reflects a strategic move to strengthen managerial investment in the company, potentially enhancing stakeholder confidence and aligning management interests with shareholder value.

Business Operations and Strategy
Hikma Pharmaceuticals’ Credit Rating Upgraded by S&P
Positive
May 8, 2025

S&P has upgraded Hikma Pharmaceuticals PLC’s long-term issuer credit rating and its $500 million notes to ‘BBB’ from ‘BBB-‘, citing the company’s strong business momentum and stable growth prospects. This upgrade reinforces Hikma’s solid market position and highlights its consistent profitability and cash generation capabilities.

Legal Proceedings
Hikma Pharmaceuticals Settles Xyrem® Antitrust Lawsuits in the U.S.
Neutral
May 8, 2025

Hikma Pharmaceuticals has announced a preliminary settlement agreement to resolve the majority of antitrust class action lawsuits related to its product Xyrem® (sodium oxybate) in the United States. The agreement, which is subject to court approval, involves Hikma paying up to $50 million in cash. This settlement aims to protect the company’s interests and provide clarity to stakeholders, without admitting any wrongdoing. The settlement highlights Hikma’s commitment to facilitating access to lower-cost generic medicines, potentially impacting its market positioning and stakeholder relations.

Private Placements and FinancingBusiness Operations and Strategy
Hikma Pharmaceuticals Announces Managerial Share Transactions
Neutral
Apr 30, 2025

Hikma Pharmaceuticals PLC announced a notification regarding transactions by key managerial personnel, including the Executive Chairman, Executive Vice Chairman, and a Non-Executive Director. These transactions involve a pledge of 600,000 ordinary shares by Darhold Limited, a company associated with these executives, in favor of EFG International Bank. This move reflects significant financial maneuvers within the company, potentially impacting its market dynamics and stakeholder interests.

Shareholder MeetingsDividendsBusiness Operations and Strategy
Hikma Pharmaceuticals Successfully Concludes 2025 AGM with All Resolutions Passed
Positive
Apr 24, 2025

Hikma Pharmaceuticals announced the successful completion of its 2025 Annual General Meeting, where all proposed resolutions were approved by shareholders. Key resolutions included the approval of a final dividend of 48 cents per share, reappointment of PricewaterhouseCoopers as auditors, and re-election of several directors. The approval of these resolutions reflects strong shareholder support and is expected to positively impact the company’s governance and financial strategies.

Business Operations and StrategyFinancial Disclosures
Hikma Pharmaceuticals Reaffirms 2025 Guidance Amid Strong Global Performance
Positive
Apr 24, 2025

Hikma Pharmaceuticals has reaffirmed its full-year guidance for 2025, highlighting strong performance across its global operations. The company’s Injectables business is experiencing solid revenue growth, particularly in Europe and MENA, with recent product launches in North America contributing positively. Hikma’s Branded segment is expanding its oncology portfolio in the MENA region through strategic partnerships, while its Generics business is maintaining stable demand. The company is enhancing its manufacturing capabilities in the US and expects overall revenue growth between 4% and 6%, with core operating profit projected to be between $730 million and $770 million. Hikma’s strategic investments in R&D and local manufacturing are expected to sustain its competitive position and drive future growth.

Executive/Board ChangesBusiness Operations and Strategy
Hikma Pharmaceuticals Announces Discretionary Share Awards to Key Executives
Neutral
Apr 10, 2025

Hikma Pharmaceuticals PLC announced the granting of discretionary share awards under its 2023 Long Term Incentive Plan (LTIP) and Deferred Bonus Plan (DBP) to key managerial personnel. These awards, which are conditional on continued employment and performance criteria, are designed to align the interests of the company’s leadership with its long-term strategic goals, potentially impacting the company’s operational focus and stakeholder value.

Regulatory Filings and Compliance
Hikma Pharmaceuticals Announces Share Disposal by Non-Executive Director
Neutral
Apr 8, 2025

Hikma Pharmaceuticals announced a transaction involving the disposal of shares by Victoria Hull, a Non-Executive Director of the company. The transaction, which involved the sale of 2,777 ordinary shares at a price of £18.00 each, was conducted on the London Stock Exchange, totaling £49,986. This notification is part of compliance with the EU Market Abuse Regulation, reflecting transparency in managerial transactions.

Shareholder MeetingsFinancial DisclosuresRegulatory Filings and Compliance
Hikma Pharmaceuticals Releases 2024 Annual Report and AGM Notice
Neutral
Mar 19, 2025

Hikma Pharmaceuticals has released its 2024 Annual Report and Accounts alongside the Notice of the 2025 Annual General Meeting. These documents are now accessible to shareholders via the company’s website and the UK National Storage Mechanism, reflecting Hikma’s commitment to transparency and regulatory compliance. This announcement underscores Hikma’s ongoing efforts to maintain strong communication with its stakeholders and adhere to financial reporting standards, potentially impacting investor confidence and market perception.

Executive/Board Changes
Hikma Pharmaceuticals Announces Vesting of Executive Share Awards
Positive
Mar 4, 2025

Hikma Pharmaceuticals announced the vesting of conditional share awards for several key executives under its Executive Incentive Plan. This move reflects the company’s ongoing commitment to rewarding its leadership team, potentially enhancing managerial stability and aligning executive interests with shareholder value. The shares were acquired without any cost and retained by the executives, indicating confidence in the company’s future performance.

M&A TransactionsDividendsBusiness Operations and StrategyFinancial Disclosures
Hikma Pharmaceuticals Reports Strong 2024 Performance and Positive 2025 Outlook
Positive
Feb 26, 2025

Hikma Pharmaceuticals reported a strong financial performance for 2024, with a 10% growth in core revenue and a 67% increase in reported operating profit. The company’s strategic acquisitions, such as Xellia Pharmaceuticals’ US business, and new partnerships have bolstered its market position, particularly in the injectables and generics segments. Hikma’s continued investment in R&D and business development is expected to drive future growth, with a positive outlook for 2025, including projected revenue growth of 4% to 6%. The company’s robust balance sheet and increased dividend reflect confidence in its future prospects.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.