Hikma Pharmaceuticals (HIK) AI Stock Analysis

• Market Cap: £3.33B
• Dividend Yield: 4.2%
• Average Volume (3M): 631.74K
• Price to Earnings (P/E): 11.7
• Beta (1Y): 0.86
• Revenue Growth: 3.73%
• EPS Growth: 27.13%
• Country: UK
• Employees: 9,500
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.92
• Shares Outstanding: 221,886,460
• 10 Day Avg. Volume: 531,484
• 30 Day Avg. Volume: 631,743
• PEG Ratio: 0.17
• Price to Book (P/B): 2.41
• Price to Sales (P/S): 1.78
• P/FCF Ratio: 13.93
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £2,266.00
• Price Target Upside: 49.87% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: 1,793.00p ▲(18.58% Upside)

Hikma Pharmaceuticals' overall stock score is driven by strong financial performance and attractive valuation. While technical indicators suggest a bearish trend, the company's strategic achievements and executive confidence provide a positive outlook. Earnings call insights and corporate events further support the stock's potential for growth.

Positive Factors

Revenue Growth

Consistent revenue growth across all segments and regions indicates strong market demand and effective business strategies, supporting long-term expansion.

Injectables Segment Performance

The Injectables segment's strong growth, aided by acquisitions and new launches, underscores Hikma's competitive advantage in high-demand therapeutic areas.

Strong Pipeline Developments

FDA approvals and pipeline expansion enhance Hikma's product offerings and market position, driving future revenue and market share growth.

Negative Factors

Operating Profit Decline

A decline in operating profit due to regional and product mix challenges may hinder profitability, affecting long-term financial health.

Decreased Operating Cash Flow

Reduced operating cash flow limits financial flexibility and may impact the company's ability to invest in growth opportunities.

Margin Pressure in Injectables

Margin pressure in the Injectables segment due to cost increases and mix changes could erode profitability, impacting long-term margins.

Hikma Pharmaceuticals Business Overview & Revenue Model

Company Description

Hikma Pharmaceuticals is a multinational pharmaceutical company headquartered in London, UK, focused on developing, manufacturing, and marketing a broad range of generic and branded pharmaceuticals. Established in 1978, Hikma operates primarily in three segments: Injectables, Generics, and Branded. The company provides a diverse portfolio of products across various therapeutic areas, including pain management, oncology, and cardiovascular health, catering to both healthcare professionals and patients worldwide.

How the Company Makes Money

Hikma Pharmaceuticals generates revenue through multiple key streams. The Injectables segment, which includes a range of sterile injectable products, is a significant contributor to the company's earnings, capitalizing on the rising demand for complex generics and specialty medications. The Generics segment generates income by offering a variety of generic drugs, which are typically lower-cost alternatives to branded medications. The Branded segment focuses on proprietary products in specific markets, particularly in the Middle East and North Africa, where it has established strong brand recognition. Additionally, Hikma engages in strategic partnerships and collaborations with other pharmaceutical firms, enhancing its product offerings and market reach. Factors such as regulatory approvals, market expansion strategies, and the company's ability to innovate and streamline its production processes further contribute to its overall profitability.

Hikma Pharmaceuticals Financial Statement Overview

Summary

Hikma Pharmaceuticals demonstrates strong financial health with consistent revenue and profit growth. The company maintains robust profitability margins and efficient cash generation, despite a slight decrease in free cash flow. Debt levels are manageable, and equity financing is solid, indicating a stable financial position.

Income Statement

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

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

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	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.22B	3.13B	2.88B	2.52B	2.55B	2.34B
Gross Profit	1.37B	1.42B	1.41B	1.26B	1.30B	1.21B
EBITDA	547.00M	787.00M	791.00M	485.00M	744.00M	631.00M
Net Income	371.00M	359.00M	190.00M	188.00M	421.00M	431.00M
Balance Sheet
Total Assets	5.55B	5.13B	4.68B	4.47B	4.37B	4.13B
Cash, Cash Equivalents and Short-Term Investments	236.00M	213.00M	229.00M	292.00M	450.00M	347.00M
Total Debt	1.55B	1.31B	1.19B	1.28B	846.00M	932.00M
Total Liabilities	3.00B	2.81B	2.47B	2.32B	1.91B	1.99B
Stockholders Equity	2.50B	2.31B	2.20B	2.13B	2.45B	2.13B
Cash Flow
Free Cash Flow	363.00M	399.00M	439.00M	392.00M	493.00M	292.00M
Operating Cash Flow	527.00M	564.00M	608.00M	530.00M	638.00M	464.00M
Investing Cash Flow	-490.00M	-381.00M	-333.00M	-607.00M	-238.00M	-283.00M
Financing Cash Flow	-38.00M	-188.00M	-337.00M	-58.00M	-287.00M	-298.00M

Hikma Pharmaceuticals Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1512.00
• 50DMA: Negative
• 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 GB:HIK, the sentiment is Negative. The current price of 1512 is below the 20-day moving average (MA) of 1552.10, below the 50-day MA of 1642.32, and below the 200-day MA of 1835.01, indicating a bearish trend. The MACD of -34.53 indicates Negative momentum. The RSI at 34.96 is Neutral, neither overbought nor oversold. The STOCH value of 26.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:HIK.

Hikma Pharmaceuticals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HIK	75 Outperform	£3.33B	11.67	15.66%	4.20%	3.73%	27.13%
HLN	73 Outperform	£33.29B	22.24	9.35%	1.50%	-2.12%	42.10%
ANCR	67 Neutral	£164.33M	-6.71	2.83%	2.18%	8.74%	-166.50%
AGY	57 Neutral	£706.27M	-13.69	―	―	-0.28%	22.94%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Hikma Pharmaceuticals Corporate Events

Hikma Pharmaceuticals Chairman Acquires Significant Shareholding

Hikma Pharmaceuticals PLC announced a significant transaction involving the purchase of ordinary shares by Said Darwazah, the Executive Chairman of the company. The transactions, conducted on the London Stock Exchange, involved the acquisition of 530,000 shares at an average price of approximately £15.77, totaling over £8.3 million. This move indicates a strong vote of confidence in the company’s future prospects by its leadership, potentially impacting stakeholder perceptions and market positioning.

Hikma Pharmaceuticals Executives Increase Shareholdings

Hikma Pharmaceuticals announced transactions involving the purchase of shares by key managerial personnel. Executive Vice Chairman Mazen Darwazah acquired 315,000 shares at an aggregated price of £16.009, totaling £5,042,760, while Senior Independent Director Victoria Hull purchased 3,214 shares at £15.47 each, totaling £49,720.58. These transactions, conducted on the London Stock Exchange, reflect a significant investment by the company’s leadership, potentially signaling confidence in the company’s future performance and stability.

Hikma Pharmaceuticals Updates 2025 Guidance and Medium-Term Outlook

Hikma Pharmaceuticals has confirmed its 2025 guidance and updated its medium-term growth outlook, highlighting progress in product launches, partnerships, and global manufacturing expansion. The Injectables business is performing well, with strong sales in Europe and MENA, and new product launches in the US. The Branded segment benefits from its oncology and chronic illness treatments, while Hikma Rx sees robust performance in respiratory and nasal spray categories. Organizational changes include centralizing R&D under a global structure to accelerate product development. Despite adjusting medium-term profit expectations due to supply chain challenges, Hikma remains focused on expanding manufacturing capacity and increasing R&D investment to meet growing demand.

Hikma Pharmaceuticals Executives Acquire Shares, Signaling Confidence

Hikma Pharmaceuticals PLC announced that several of its Persons Discharging Managerial Responsibilities (PDMRs) have acquired ordinary shares in the company through a dividend reinvestment plan. This move, disclosed under the EU Market Abuse Regulation, indicates a continued commitment from the company’s leadership towards its growth and stability, potentially enhancing stakeholder confidence and reinforcing its market position.

Hikma Pharmaceuticals Executive Vice Chairman Acquires Shares

Hikma Pharmaceuticals announced a transaction involving Mazen Darwazah, the Executive Vice Chairman, who purchased 14,000 ordinary shares at £16.03 each, totaling £224,417.76, on the London Stock Exchange. This transaction is part of the company’s regulatory disclosure obligations under the EU Market Abuse Regulation, indicating continued confidence in the company’s market position and potential positive implications for stakeholders.