Organon (OGN) AI Stock Analysis

• Market Cap: $1.81B
• Dividend Yield: 4.88%
• Average Volume (3M): 5.68M
• Price to Earnings (P/E): 3.6
• Beta (1Y): 0.52
• Revenue Growth: -1.69%
• EPS Growth: -61.89%
• Country: US
• Employees: 10,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - General
• EPS (TTM): 1.01
• Shares Outstanding: 259,982,900
• 10 Day Avg. Volume: 4,784,065
• 30 Day Avg. Volume: 5,678,915
• PEG Ratio: -0.27
• Price to Book (P/B): 8.13
• Price to Sales (P/S): 0.60
• P/FCF Ratio: 6.52
• Enterprise Value/Market Cap: 6.04
• Enterprise Value/Revenue: 1.74
• Enterprise Value/Gross Profit: 3.15
• Enterprise Value/Ebitda: 6.95
• 1Y Price Target: $8.50
• Price Target Upside: 21.95% Upside
• Rating Consensus: Strong Sell
• Number of Analyst Covering: 5
• EPS Forecast (FY): 3.79
• Revenue Forecast (FY): $6.24B

• Rating: 53 Neutral
• Price Target: $7.50 ▲(7.60% Upside)

Organon's overall stock score reflects a mixed financial performance with strong revenue growth but declining profit margins and high leverage. The technical analysis indicates bearish trends, while the valuation suggests the stock is undervalued. The earnings call and recent corporate events highlight operational challenges and governance issues, impacting investor confidence.

Positive Factors

Biosimilars Growth

The strong growth in biosimilars, particularly Hadlima, indicates a successful expansion into high-demand markets, enhancing revenue diversification and long-term growth potential.

Strategic Divestiture

The divestiture of non-core assets like the Jada system allows Organon to focus on its core women's health business while improving its balance sheet and financial flexibility.

Positive Free Cash Flow

Strong free cash flow generation demonstrates effective cash management and provides the company with resources to invest in growth opportunities and reduce debt.

Negative Factors

CEO Resignation

The CEO's resignation due to a sales practices investigation raises concerns about governance and operational integrity, potentially impacting strategic direction and investor confidence.

High Financial Leverage

Despite improvements, high leverage remains a risk, limiting financial flexibility and increasing vulnerability to interest rate changes, affecting long-term stability.

Declining Profit Margins

The decline in profit margins suggests cost pressures and reduced profitability, which could hinder the company's ability to reinvest in growth and maintain competitive positioning.

Organon Business Overview & Revenue Model

Company Description

Organon & Co., a health care company, develops and delivers health solutions through a portfolio of prescription therapies in the United States and internationally. Its women's health portfolio comprises contraception and fertility brands, such as Nexplanon/Implanon, a long-acting reversible contraceptive. The company's biosimilars portfolio consists of three immunology products, such as Brenzys, Renflexis, and Hadlima, as well as two oncology products, including Ontruzant and Aybintio. It also offers cardiovascular products, consisting of several cholesterol-modifying medicines under the Zetia, Ezetrol, Vytorin, Inegy, Rosuzet, and Zocor brands; Cozaar and Hyzaar for the treatment of hypertension; respiratory products for various treatments to control and prevent symptoms caused by asthma under the Singulair, Dulera, Zenhale, and Asmanex brand names; and Singulair, Nasonex, Clarinex, and Aerius for treating seasonal allergic rhinitis. In addition, the company provides dermatology products under the Diprosone and Elocon brand; bone health portfolio, including Fosamax brand name; non-opioid pain management products under the Arcoxia, Diprospan, and Celestone brand names; Proscar for the treatment of symptomatic benign prostatic hyperplasia; and Propecia for the treatment of male pattern hair loss. The company sells its products primarily to drug wholesalers and retailers, hospitals, and government agencies, as well as managed health care providers, such as health maintenance organizations, pharmacy benefit managers, and other institutions. Organon & Co. was incorporated in 2020 and is based in Jersey City, New Jersey.

How the Company Makes Money

Organon generates revenue primarily through the sale of its pharmaceutical products, which include prescription medications and over-the-counter solutions targeting women's health. Key revenue streams include hormonal contraceptives, fertility drugs, and treatments for menopause-related conditions. The company also benefits from partnerships and collaborations with healthcare providers and other pharmaceutical companies, enhancing its product offerings and market reach. Additionally, Organon focuses on expanding its portfolio through research and development, aiming to introduce new therapies that align with its mission to serve women's health needs. The company's strategic initiatives to improve accessibility and affordability for patients further contribute to its earnings potential.

Organon Financial Statement Overview

Summary

Organon is experiencing declining revenues and high leverage, which are impacting its financial stability. While cash flow management is relatively strong, the company needs to address revenue growth and leverage to improve its financial health.

Income Statement

Organon's income statement shows a significant decline in revenue growth, with a TTM revenue drop of 25.16%. Gross profit margins have decreased slightly from previous years, and net profit margins have also contracted. The EBIT and EBITDA margins have shown some resilience, but overall profitability is under pressure due to declining revenues.

Balance Sheet

The balance sheet reveals high leverage with a debt-to-equity ratio of 9.74 in the TTM period, indicating significant financial risk. The return on equity is strong at 78.07%, but this is due to the low equity base. The equity ratio is low, suggesting potential solvency issues.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth by 20.04% in the TTM period. However, the operating cash flow to net income ratio is strong, indicating good cash generation relative to net income. The free cash flow to net income ratio remains healthy, suggesting efficient cash management despite revenue challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.30B	6.40B	6.26B	6.17B	6.30B	6.53B
Gross Profit	3.47B	3.71B	3.75B	3.88B	3.92B	4.41B
EBITDA	1.57B	1.60B	1.44B	1.76B	1.98B	2.99B
Net Income	501.00M	864.00M	1.02B	917.00M	1.35B	2.16B
Balance Sheet
Total Assets	13.55B	13.10B	12.06B	10.96B	10.68B	10.11B
Cash, Cash Equivalents and Short-Term Investments	672.00M	675.00M	693.00M	706.00M	737.00M	12.00M
Total Debt	8.83B	9.04B	8.93B	9.11B	9.36B	31.00M
Total Liabilities	12.65B	12.63B	12.13B	11.85B	12.19B	4.62B
Stockholders Equity	906.00M	472.00M	-70.00M	-892.00M	-1.51B	5.49B
Cash Flow
Free Cash Flow	566.00M	588.00M	538.00M	431.00M	1.97B	1.91B
Operating Cash Flow	949.00M	939.00M	799.00M	858.00M	2.46B	2.19B
Investing Cash Flow	-621.00M	-513.00M	-260.00M	-420.00M	-481.00M	-258.00M
Financing Cash Flow	-456.00M	-368.00M	-569.00M	-433.00M	-1.33B	-2.17B

Organon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.97
• 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 OGN, the sentiment is Negative. The current price of 6.97 is below the 20-day moving average (MA) of 7.30, below the 50-day MA of 7.81, and below the 200-day MA of 9.98, indicating a bearish trend. The MACD of -0.19 indicates Negative momentum. The RSI at 40.98 is Neutral, neither overbought nor oversold. The STOCH value of 24.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OGN.

Organon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MRK	80 Outperform	$243.91B	13.00	39.51%	3.34%	1.59%	58.02%
BMY	78 Outperform	$110.40B	18.31	33.84%	4.84%	1.26%	―
GSK	77 Outperform	$98.53B	13.72	35.62%	3.42%	5.97%	128.66%
SNY	75 Outperform	$115.94B	11.80	8.39%	4.66%	-9.32%	120.62%
GRFS	72 Outperform	$7.68B	14.59	6.93%	1.59%	9.45%	167.00%
OGN	53 Neutral	$1.81B	3.62	71.62%	4.88%	-1.69%	-61.89%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Organon Corporate Events

Organon Reports Q3 2025 Financial Results

Organon reported its third-quarter 2025 financial results, showing a slight increase in revenue to $1.602 billion, up 1% as-reported but down 1% excluding foreign currency impacts. The company lowered its full-year revenue guidance to $6.200 billion to $6.250 billion and adjusted EBITDA margin to approximately 31.0%. The quarter saw a decline in women’s health revenue by 3% as-reported, while biosimilars revenue increased by 19% due to strong performance of certain products. Organon is focusing on cost discipline and debt reduction to create capacity for future growth opportunities.

Grace Puma to Step Down from Organon Board

On November 3, 2025, Grace Puma announced she will not seek re-election at Organon & Co.’s 2026 Annual Meeting of Stockholders. Ms. Puma, who has been on the Board of Directors since 2021 and serves on the Talent Committee, will continue her role until the meeting. Her decision to step down is not due to any disagreements with the company or its management.

Organon CEO Resigns Amid Sales Practices Probe

On October 26, 2025, Kevin Ali resigned as CEO and board member of Organon due to an investigation into the company’s wholesaler sales practices. The Audit Committee’s investigation revealed improper sales practices involving Nexplanon, which allowed the company to meet revenue expectations during certain periods. As a result, Organon appointed Joseph Morrissey as Interim CEO and Carrie S. Cox as Executive Chair. The company is taking steps to improve financial controls and address material weaknesses, while initiating a search for a permanent CEO.