Hikma Pharmaceuticals (HIK) AI Stock Analysis

• Market Cap: £4.40B
• Dividend Yield: 0.15%
• Average Volume (3M): 399.90K
• Price to Earnings (P/E): 15.7
• Beta (1Y): 0.85
• Revenue Growth: 5.83%
• EPS Growth: 83.35%
• Country: UK
• Employees: 9,500
• Sector: Healthcare
• Sector Strength: 37
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.47
• Shares Outstanding: 221,886,460
• 10 Day Avg. Volume: 286,068
• 30 Day Avg. Volume: 399,897
• PEG Ratio: 0.64
• Price to Book (P/B): 2.64
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 15.27
• Enterprise Value/Market Cap: 1.63
• Enterprise Value/Revenue: 1.03
• Enterprise Value/Gross Profit: 8.78
• Enterprise Value/Ebitda: 3.75
• 1Y Price Target: £2,503.00
• Price Target Upside: 23.42% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 73 Outperform
• Price Target: 2,263.00p ▲(11.59%Upside)

Hikma Pharmaceuticals' strong financial performance and positive corporate events are the primary contributors to the overall score. Stable profitability, efficient cash management, and strategic initiatives support the company's growth prospects. Technical analysis and valuation provide a balanced view, while the lack of recent earnings call data limits additional insights.

Positive Factors

Earnings Growth

Hikma delivered a top of range FY24 print and successfully navigated a tough comp year, delivering a 6% beat to core EBIT compared to guidance at the start of 2024.

Market Demand

Strong demand in European and MENA markets, while North America benefits from good demand for the recently launched liraglutide injection and the contribution from the newly acquired Xellia portfolio.

Negative Factors

Interest Charges

Forecasts have been updated to reflect a 2% reduction to FY25 core EBIT and a 5% reduction to adjusted EPS due to higher interest charges.

Sales Mix Impact

The company expects the phasing and mix of sales to impact margins in the first half, although it maintains a mid-30s core operating margin for FY25.

Hikma Pharmaceuticals Business Overview & Revenue Model

Company Description

Hikma Pharmaceuticals (HIK) is a multinational pharmaceutical company that develops, manufactures, and markets a broad range of branded and non-branded generic and in-licensed pharmaceutical products. Serving both the branded and generic pharmaceutical sectors, the company focuses on critical therapeutic areas such as cardiovascular, respiratory, oncology, and pain management. Hikma operates in multiple regions including the United States, the Middle East and North Africa (MENA), and Europe, positioning itself as a key player in providing accessible and affordable medications globally.

How the Company Makes Money

Hikma Pharmaceuticals generates revenue primarily through the sale of its pharmaceutical products across three main business segments: Injectables, Generics, and Branded. The Injectables segment is a significant contributor to revenue, driven by the production and distribution of generic injectable products used in hospitals. The Generics segment focuses on the development and sale of non-branded generic drugs, primarily in the United States, catering to a wide range of therapeutic categories. The Branded segment involves the sale of branded generics and in-licensed products across the MENA region, leveraging Hikma's strong regional presence and brand recognition. Additionally, the company benefits from strategic partnerships and collaborations that help expand its product portfolio and market reach, contributing to its overall earnings.

Hikma Pharmaceuticals Financial Statement Overview

Summary

Hikma Pharmaceuticals demonstrates strong financial health across income, balance sheet, and cash flow statements. The company shows consistent revenue and profit growth with stable profitability margins, efficient cash generation, and manageable debt levels.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.13B	2.88B	2.52B	2.55B	2.34B
Gross Profit	1.42B	1.41B	1.26B	1.30B	1.21B
EBITDA	787.00M	791.00M	485.00M	744.00M	654.00M
Net Income	359.00M	190.00M	188.00M	421.00M	431.00M
Balance Sheet
Total Assets	5.13B	4.68B	4.47B	4.37B	4.13B
Cash, Cash Equivalents and Short-Term Investments	213.00M	229.00M	292.00M	450.00M	347.00M
Total Debt	1.31B	1.19B	1.28B	846.00M	932.00M
Total Liabilities	2.81B	2.47B	2.32B	1.91B	1.99B
Stockholders Equity	2.31B	2.20B	2.13B	2.45B	2.13B
Cash Flow
Free Cash Flow	399.00M	439.00M	392.00M	493.00M	292.00M
Operating Cash Flow	564.00M	608.00M	530.00M	638.00M	464.00M
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 Price: 2028.00
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• 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 Positive. The current price of 2028 is above the 20-day moving average (MA) of 1989.60, below the 50-day MA of 2050.98, and above the 200-day MA of 2002.31, indicating a neutral trend. The MACD of -10.03 indicates Negative momentum. The RSI at 54.27 is Neutral, neither overbought nor oversold. The STOCH value of 51.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HIK.

Hikma Pharmaceuticals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HIK	73 Outperform	£4.40B	15.72	15.79%	0.15%	5.83%	83.35%
ANCR	73 Outperform	£200.07M	5.50	33.70%	190.11%	-0.17%	2591.96%
HLN	67 Neutral	£32.79B	22.70	8.80%	148.18%	-0.61%	39.00%
AGY	53 Neutral	£386.08M	―	-369.20%	―	4.50%	74.32%
Sector *	50 Neutral	AU$2.62B	3.32	-57.47%	2.40%	36.73%	13.67%

Hikma Pharmaceuticals Corporate Events

Hikma Pharmaceuticals Issues $500 Million in Guaranteed Notes

Hikma Pharmaceuticals, through its subsidiary Hikma Finance USA LLC, has announced the issuance of $500 million in 5.125% Guaranteed Notes due in 2030. These notes are expected to be traded on the International Securities Market of the London Stock Exchange, potentially enhancing the company’s financial flexibility and market presence.

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.

Hikma Pharmaceuticals Discloses Managerial Share Disposal

Hikma Pharmaceuticals announced a transaction involving the disposal of 40,000 ordinary shares by Bassam Kanaan, a Person Discharging Managerial Responsibilities (PDMR) within the company. The transaction, conducted on the London Stock Exchange, amounted to a total value of £842,132, reflecting a share price of £21.05. This disclosure is part of the company’s compliance with the EU Market Abuse Regulation, ensuring transparency in managerial transactions.

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.

Hikma Pharmaceuticals Discloses Share Disposal by Key Executive

Hikma Pharmaceuticals announced a transaction involving the disposal of shares by Dr. Bill Larkins, a Person Discharging Managerial Responsibilities at the company. The transaction, which involved the sale of 5,257 ordinary shares at a price of £21.28 each, was conducted on the London Stock Exchange, totaling £111,868.96. This disclosure is in compliance with the EU Market Abuse Regulation, highlighting Hikma’s commitment to transparency and regulatory adherence.

The most recent analyst rating on (GB:HIK) stock is a Buy with a £2650.00 price target. To see the full list of analyst forecasts on Hikma Pharmaceuticals stock, see the GB:HIK Stock Forecast page.

Hikma Pharmaceuticals Announces Executive Share Vesting Under Incentive Plan

Hikma Pharmaceuticals PLC announced the vesting of conditional share awards under its 2014 Executive Incentive Plan, resulting in the acquisition of shares by several key executives, including the Executive Chairman, CEO, and Executive Vice Chairman. This transaction reflects the company’s ongoing commitment to incentivize its leadership, potentially impacting its market positioning by aligning executive interests with shareholder value.

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.

Hikma Pharmaceuticals Receives Rating Upgrade from Fitch

Hikma Pharmaceuticals announced that Fitch has upgraded its long-term issuer default rating to ‘BBB’ with a stable outlook, aligning with S&P’s recent upgrade. This reflects confidence in Hikma’s strategic direction, financial discipline, and operational resilience, highlighting its solid market position and ability to deliver strong financial results.

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.

Hikma Pharmaceuticals Executives Involved in Share Pledge Transactions

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.

Hikma Pharmaceuticals Projects Strong Growth and Rebrands Generics Business

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.

Hikma Pharmaceuticals Executives Acquire Shares Under DRIP

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.

Hikma Pharmaceuticals’ Credit Rating Upgraded by S&P

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.

Hikma Pharmaceuticals Settles Xyrem® Antitrust Lawsuits in the U.S.

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.

Hikma Pharmaceuticals Announces Managerial Share Transactions

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.