GlaxoSmithKline (GSK) AI Stock Analysis

Compare

5,022 Followers

Top Page

GlaxoSmithKline

(NYSE:GSK)

Rating:68Neutral

Price Target:

$41.00

▲(7.25%Upside)

GSK's overall stock score is driven by strong earnings call insights and favorable valuation. Stable financial performance provides a solid foundation, though technical indicators suggest some caution in the short term. The company's strategic focus on specialty medicines and R&D advancements position it well for future growth.

Positive Factors

Acquisition Strategy

The acquisition of efimosfermin is sound given that it expands GSK's hepatology portfolio, provides optionality to related diseases, and fits within GSK's BD strategy.

Product Development

GSK's press release characterized the clinical profile of efimosfermin as 'potential best in class' based upon unique properties such as low immunogenicity and extended half-life.

Negative Factors

Manufacturing Complexity

GSK noted the manufacturing for Trelegy is even more complicated than those devices, which suggests a competitive advantage.

GlaxoSmithKline (GSK) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$75.79B

Dividend Yield0.11%

Average Volume (3M)5.72M

Price to Earnings (P/E)19.5

Beta (1Y)0.28

Revenue Growth4.17%

EPS Growth-29.96%

CountryUS

Employees68,629

SectorHealthcare

Sector Strength37

IndustryDrug Manufacturers - General

Share Statistics

EPS (TTM)1.20

Shares Outstanding2,040,532,100

10 Day Avg. Volume7,351,181

30 Day Avg. Volume5,720,794

Financial Highlights & Ratios

PEG Ratio0.83

Price to Book (P/B)4.05

Price to Sales (P/S)0.00

P/FCF Ratio15.59

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$43.00

Price Target Upside12.48% Upside

Rating ConsensusHold

Number of Analyst Covering2

GlaxoSmithKline Business Overview & Revenue Model

Company DescriptionGSK plc, together with its subsidiaries, engages in the research, development, and manufacture of vaccines, and specialty and general medicines to prevent and treat disease in the United Kingdom, the United States, and internationally. It operates through two segments, Commercial Operations and Total R&D. The company offers shingles, meningitis, respiratory syncytial virus, flu, polio, influenza, and pandemic vaccines. It also provides medicines for HIV, oncology, respiratory/immunology, and other specialty medicine products, as well as inhaled medicines for asthma and chronic obstructive pulmonary disease, and antibiotics for infections. It has a collaboration agreement with CureVac to develop mRNA-based influenza vaccines, and with Wave Life Sciences and Elsie Biotechnologies, Inc for oligonucleotide platform development; two strategic collaborations with Relation to advance therapeutics for fibrotic diseases and osteoarthritis; and multi-target strategic alliance with GSK to develop breakthrough treatments for people afflicted with Parkinson's disease; as well as collaboration with Flagship Pioneering to discover novel medicines and vaccines. The company was formerly known as GlaxoSmithKline plc and changed its name to GSK plc in May 2022. GSK plc was founded in 1715 and is headquartered in Brentford, the United Kingdom.dom.

How the Company Makes MoneyGSK generates revenue through the sale of its pharmaceutical products, vaccines, and consumer healthcare goods. The Pharmaceuticals segment is the largest contributor to GSK's revenue, focusing on therapeutic areas such as respiratory, HIV, oncology, and immuno-inflammation. The Vaccines segment provides a significant revenue stream as well, with a portfolio that includes vaccines for diseases like influenza, shingles, and meningitis. The Consumer Healthcare segment offers over-the-counter medicines, oral health products, nutritional products, and skin health products. GSK also engages in strategic partnerships and collaborations with other companies and research institutions to enhance its research capabilities and expand its product offerings. Additionally, GSK benefits from patent protections and regulatory approvals, which allow it to maintain competitive pricing and market exclusivity for its innovative products.

GlaxoSmithKline Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Breaks down revenue by different business segments, highlighting which areas drive the most sales and profitability, and indicating where the company might focus its strategic efforts.

Chart InsightsGSK's Specialty Medicines segment has shown robust growth, particularly in 2024, driven by strong performances in respiratory immunology and oncology, aligning with a 17% sales increase highlighted in the earnings call. However, vaccine sales have faced a decline, with Shingrix sales impacted by macroeconomic factors and supply issues in China. Despite these challenges, GSK's strategic focus on R&D and oncology pipeline enhancements, including the acquisition of IDRX, positions the company for sustained growth, supported by a positive long-term outlook and ongoing product launches.

Data provided by:

Main Street Data

GlaxoSmithKline Earnings Call Summary

Earnings Call Date:Apr 30, 2025

(Q1-2025)

% Change Since: -0.78%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong growth in specialty medicines and promising R&D advancements, positioning GSK for continued success. However, challenges such as declining vaccine sales, macroeconomic uncertainties, and impacts from Medicare Part D redesign were notable concerns. Despite these issues, the overall sentiment remains positive due to strategic growth areas and confident long-term outlooks.

Q1-2025 Updates

Positive Updates

Strong Sales and Earnings Growth

Group sales increased by 4%, core operating profit grew by 5%, and core earnings per share rose by 5% to 44.9 pence. Cash generated from operations was over £1 billion.

Specialty Medicines Performance

Specialty medicines, the largest business segment, grew by 17%, driven by contributions from respiratory immunology, oncology, and HIV.

Oncology Segment Growth

Oncology sales increased by 53%, with notable performances from Jemperli and AGILE, which more than doubled their sales.

HIV Treatment and Prevention Growth

HIV sales grew by 7%, driven by products like Dovato, Cabenuva, and Apretude, which saw growth of 19%, 38%, and 63% respectively.

R&D and Pipeline Progress

Two out of five expected FDA product approvals for 2025 have been secured. Promising assets like the ADC targeting B7H3 and the acquisition of IDRX enhance the oncology pipeline.

Positive Long-term Outlook

GSK remains confident in its medium and long-term growth prospects, with multiple product launches and FDA approvals anticipated in the coming years.

Negative Updates

Vaccine Sales Decline

Vaccine sales were down 6%, with Shingrix sales declining by 7% due to lower sales in the U.S. and international markets.

Impact of Medicare Part D Redesign

The redesign posed a significant financial headwind, with a projected impact of £400 million to £500 million throughout the year, primarily affecting HIV and specialty medicines.

Challenges in China

Shingrix sales in China were impacted by agreed lower supply to a co-promotion partner, and broader macroeconomic challenges were noted.

Tariffs and Macroeconomic Concerns

Potential sector tariffs and elevated levels of macroeconomic uncertainty pose risks, though GSK noted strategies to navigate these challenges.

Company Guidance

During GSK's Q1 2025 earnings call, the company reaffirmed its financial guidance for the year, reflecting strong performance and strategic advancements. Key metrics highlighted include a 4% increase in group sales, 5% growth in core operating profit, and 5% rise in core earnings per share to 44.9 pence. Specialty medicines drove sales growth with a 17% increase, whereas vaccine sales declined by 6% and general medicine sales remained stable. The company secured two out of the five FDA product approvals anticipated for 2025 and completed the acquisition of IDRX, enhancing its oncology pipeline. GSK generated over £1 billion in cash from operations, supporting its £2 billion share buyback program and increased dividend to 16 pence. The company maintained its trust goals, reaching an estimated 2 billion people with its vaccines and medicines over the past four years. Additionally, GSK confirmed its commitment to R&D productivity improvements and future growth opportunities, with 14 key pipeline opportunities expected to launch between 2025 and 2031, each having peak year sales potential of over £2 billion.

GlaxoSmithKline Financial Statement Overview

Summary

GSK's financial performance shows stable revenue growth and profitability, although margins have seen some pressure. The balance sheet presents moderate leverage with a strong ROE but a low equity ratio that could pose risks. Cash flow generation remains strong, but declining free cash flow indicates potential challenges in cash retention.

Income Statement

Positive

GSK's income statement reflects moderate profitability with a Gross Profit Margin of 71.2% and a Net Profit Margin of 8.2% for 2024. Despite a decline in EBIT Margin from 17.2% in 2023 to 12.8% in 2024, the company maintains a strong EBITDA Margin of 21.3%. Revenue growth rate shows a 3.5% increase from 2023 to 2024, indicating stable revenue expansion, although profitability has been somewhat pressured.

Balance Sheet

Neutral

The balance sheet shows a Debt-to-Equity Ratio of 1.24, indicating moderate leverage compared to industry standards. Return on Equity is healthy at 18.8% for 2024, showing effective use of equity. However, the Equity Ratio stands at 23.0%, suggesting a relatively low equity buffer against total assets, which could pose risks during financial downturns.

Cash Flow

Neutral

GSK's cash flow statement reveals a decrease in Free Cash Flow from 4.42 billion in 2023 to 3.57 billion in 2024, reflecting a negative growth rate of 19.2%. The Operating Cash Flow to Net Income Ratio is strong at 2.54, indicating robust cash generation relative to net income. However, the Free Cash Flow to Net Income Ratio has decreased to 1.39, suggesting less cash retained per profit unit.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	31.38B	30.33B	29.32B	34.11B	34.10B
Gross Profit	22.33B	21.76B	19.77B	22.51B	22.39B
EBITDA	6.67B	9.14B	8.63B	7.76B	10.16B
Net Income	2.58B	4.93B	4.92B	4.38B	5.75B
Balance Sheet
Total Assets	59.46B	59.01B	60.15B	79.10B	80.43B
Cash, Cash Equivalents and Short-Term Investments	3.71B	4.99B	7.88B	4.33B	6.37B
Total Debt	16.99B	18.02B	20.99B	24.17B	27.15B
Total Liabilities	46.38B	46.21B	50.05B	57.76B	59.62B
Stockholders Equity	13.67B	13.35B	10.60B	15.05B	14.59B
Cash Flow
Free Cash Flow	3.57B	4.42B	5.14B	5.02B	6.20B
Operating Cash Flow	6.55B	6.77B	7.40B	7.95B	8.44B
Investing Cash Flow	-1.23B	-1.59B	-8.77B	-1.78B	2.16B
Financing Cash Flow	-4.73B	-5.64B	823.00M	-7.59B	-10.13B

GlaxoSmithKline Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price38.23

Price Trends

50DMA

38.93

Negative

100DMA

38.15

Negative

200DMA

36.44

Positive

Market Momentum

MACD

-0.40

Negative

RSI

48.44

Neutral

STOCH

74.62

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GSK, the sentiment is Neutral. The current price of 38.23 is above the 20-day moving average (MA) of 38.04, below the 50-day MA of 38.93, and above the 200-day MA of 36.44, indicating a neutral trend. The MACD of -0.40 indicates Negative momentum. The RSI at 48.44 is Neutral, neither overbought nor oversold. The STOCH value of 74.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GSK.

GlaxoSmithKline Risk Analysis

GlaxoSmithKline disclosed 1 risk factors in its most recent earnings report. GlaxoSmithKline reported the most risks in the "Legal & Regulatory" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

GlaxoSmithKline Peers Comparison

Overall Rating

UnderperformOutperform

Sector (52)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MRK	80 Outperform	$210.88B	12.23	39.31%	3.78%	4.40%	654.93%
AZN	78 Outperform	$228.31B	29.12	19.81%	2.12%	15.48%	22.70%
SNY	75 Outperform	$122.05B	20.87	7.34%	0.09%	-4.57%	2.96%
GILD	71 Outperform	$140.81B	23.88	32.51%	2.69%	4.63%	1144.01%
PFE	69 Neutral	$144.12B	18.38	8.62%	6.90%	13.38%	―
GSK	68 Neutral	$75.79B	19.51	22.26%	0.11%	4.17%	-29.96%
Sector *	52 Neutral	$7.61B	0.10	-63.03%	2.08%	16.34%	0.32%

* Healthcare Sector Average

Performance Comparison

GSK

GlaxoSmithKline

37.97

-0.25

-0.65%

AZN

AstraZeneca

73.68

-2.91

-3.80%

GILD

Gilead Sciences

113.20

38.60

51.74%

MRK

Merck & Company

84.71

-36.46

-30.09%

PFE

Pfizer

24.79

-3.96

-13.77%

SNY

Sanofi

50.37

-0.41

-0.81%

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 24, 2025