Lonza Group (LZAGY) AI Stock Analysis

• Market Cap: $46.04B
• Dividend Yield: 0.63%
• Average Volume (3M): 8.64K
• Price to Earnings (P/E): 55.1
• Beta (1Y): 0.97
• Revenue Growth: 8.41%
• EPS Growth: 33.09%
• Country: US
• Employees: 17,995
• Sector: Healthcare
• Sector Strength: 37
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 0.95
• Shares Outstanding: 702,290,200
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 8,641
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 8.30
• Enterprise Value/Gross Profit: 25.25
• Enterprise Value/Ebitda: 35.37
• 1Y Price Target: $85.40
• Price Target Upside: 26.63% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 64 Neutral
• Price Target: $72.00 ▲(6.76% Upside)

Lonza Group's strong earnings call performance and positive outlook are significant strengths, boosting confidence in future growth. However, high valuation and technical indicators suggest caution. Financial performance shows stability but highlights areas needing improvement, such as cash flow management.

Lonza Group Business Overview & Revenue Model

Company Description

Lonza Group AG, together with its subsidiaries, supplies various products and services for pharmaceutical, biotech, and nutrition markets in Europe, North and Central America, Latin America, Asia, Australia and New Zealand, and internationally. It operates through Biologics, Small Molecules, Cell & Gene, and Capsules & Health Ingredients segments. The Biologics segment engages in the contract development and manufacturing of biopharmaceuticals for clinical and commercial manufacturing needs throughout the product lifecycle, including drug substance and drug product manufacturing. The Small Molecules segment operates as an integrated development and manufacturing service provider for small molecule drug substances and their intermediates. It supports customers across various aspects of design, development, and manufacturing. The Cell & Gene segment develops technologies and platforms that industrialize the manufacturing processes and production of cell and gene therapies. It also offers contract development and manufacturing services, and regulatory support for a range of allogeneic and autologous cell therapies, and exosome-based therapies, as well as viral vector gene therapies. In addition, this segment provides specialty raw materials and enabling technology solutions in cell and gene therapy, injectable drugs, vaccines, and bio-manufacturing markets. The Capsules & Health Ingredients segment offers capsules, dosage form solutions, and health ingredients for pharmaceutical and nutraceutical customers. The company was founded in 1897 and is headquartered in Basel, Switzerland.

How the Company Makes Money

Lonza Group makes money primarily through its two main business segments: Pharma & Biotech and Specialty Ingredients. The Pharma & Biotech segment generates revenue by offering contract development and manufacturing services for a wide range of drug products, including biologics and cell and gene therapies. This involves long-term contracts with pharmaceutical and biotechnology companies, where Lonza provides the expertise and facilities to develop and produce drugs. The Specialty Ingredients segment contributes to earnings by supplying products used in nutrition, personal care, and other industrial applications. This includes microbial control solutions and specialty chemicals. Key revenue streams include long-term service agreements, product sales, and collaborations with major pharmaceutical and biotechnological firms. Partnerships and innovations in drug manufacturing techniques are significant factors contributing to Lonza's earnings.

Lonza Group Financial Statement Overview

Summary

Lonza Group presents a mixed financial picture. Strong profitability and operational efficiency are offset by inconsistent revenue growth and negative free cash flow due to high capital expenditures. The balance sheet is stable with a manageable debt level, but increasing liabilities require attention.

Income Statement

Lonza Group's income statement reflects stable revenue with a slight decline from the previous year. The gross profit margin and net profit margin are healthy, indicating good profitability. However, the revenue growth rate has been inconsistent, with a recent decrease. The EBIT and EBITDA margins show strong operational efficiency, but the net income has declined from its peak in 2021, suggesting some challenges in maintaining profitability growth.

Balance Sheet

The balance sheet is robust, with a solid equity base and a moderate debt-to-equity ratio, ensuring financial stability. Return on Equity (ROE) is positive but has declined, pointing to decreased efficiency in generating profits from shareholders' equity. The equity ratio is strong, indicating a healthy proportion of assets financed by shareholders' equity. However, the increase in total liabilities over time is a concern that needs monitoring.

Cash Flow

Lonza Group's cash flow situation shows mixed results. Operating cash flow remains strong, although free cash flow is negative, primarily due to significant capital expenditures. The operating cash flow to net income ratio suggests effective cash generation from operations, but the negative free cash flow to net income ratio highlights challenges in covering capital expenditures from operating activities.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.57B	6.72B	6.22B	5.41B	4.51B
Gross Profit	2.16B	1.95B	2.30B	1.97B	1.71B
EBITDA	1.54B	1.53B	2.12B	1.38B	1.39B
Net Income	636.00M	654.00M	1.22B	2.94B	869.00M
Balance Sheet
Total Assets	19.73B	16.85B	17.56B	16.69B	14.63B
Cash, Cash Equivalents and Short-Term Investments	1.71B	1.67B	2.22B	3.18B	495.00M
Total Debt	5.12B	3.13B	2.59B	2.75B	3.81B
Total Liabilities	10.35B	7.34B	6.89B	6.87B	7.74B
Stockholders Equity	9.33B	9.45B	10.60B	9.75B	6.82B
Cash Flow
Free Cash Flow	-143.00M	-263.00M	-833.00M	-126.00M	163.00M
Operating Cash Flow	1.27B	1.39B	1.04B	1.22B	1.14B
Investing Cash Flow	-2.92B	-1.10B	-991.00M	1.02B	-1.09B
Financing Cash Flow	1.28B	-152.00M	-286.00M	-1.28B	93.00M

Lonza Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 67.44
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LZAGY, the sentiment is Negative. The current price of 67.44 is below the 20-day moving average (MA) of 70.26, below the 50-day MA of 70.03, and above the 200-day MA of 64.95, indicating a neutral trend. The MACD of -0.51 indicates Positive momentum. The RSI at 36.92 is Neutral, neither overbought nor oversold. The STOCH value of 3.90 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LZAGY.

Lonza Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
A	79 Outperform	$32.56B	28.27	18.88%	0.86%	0.56%	-4.08%
TMO	77 Outperform	$173.97B	26.67	13.44%	0.36%	2.05%	7.03%
ICLR	75 Outperform	$12.32B	16.29	8.30%	―	-2.91%	12.92%
IQV	72 Outperform	$30.17B	25.92	19.80%	―	3.53%	-10.72%
DHR	69 Neutral	$143.61B	42.60	6.68%	0.59%	-3.24%	-16.60%
LZAGY	64 Neutral	$46.04B	55.12	7.97%	0.63%	8.41%	33.09%
Sector *	60 Neutral	HK$17.63B	4.46	-4.95%	3.59%	9.78%	-39.36%