Roche Holding (RHHBY) AI Stock Analysis

• Market Cap: $257.51B
• Dividend Yield: 3.51%
• Average Volume (3M): 1.27M
• Price to Earnings (P/E): 22.7
• Beta (1Y): 0.43
• Revenue Growth: 7.26%
• EPS Growth: -8.64%
• Country: US
• Employees: 103,249
• Sector: Healthcare
• Sector Strength: 38
• Industry: Drug Manufacturers - General
• EPS (TTM): 1.74
• Shares Outstanding: 5,620,501,500
• 10 Day Avg. Volume: 1,426,264
• 30 Day Avg. Volume: 1,271,105
• PEG Ratio: -1.11
• Price to Book (P/B): 6.38
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 12.80
• 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: $44.00
• Price Target Upside: 13.29% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

• Rating: 74 Outperform
• Price Target: $45.00 ▲(15.86%Upside)

Roche Holding's overall score is strengthened by its financial performance and positive earnings call sentiment. While technical analysis indicates a neutral market stance, the company's valuation remains balanced with a reasonable P/E ratio and attractive dividend yield. The absence of impactful corporate events beyond the earnings call allows for a focused evaluation on its fundamental strengths and strategic outlook.

Positive Factors

Clinical Trial Results

Early trontinemab data shows competitive amyloid clearance and improved ARIA rate versus peers, but clinical outcomes will determine success.

Financial Performance

Roche's model was updated and numbers raised post recent business trends, with sales and EPS growth estimates increased.

Product Efficacy

Gazyva showed potential best-in-class profile in lupus nephritis and is likely to be the starter therapy of choice versus GSK's Benlysta.

Negative Factors

Clinical Trial Safety

There was a case of fatal cerebral macrohemorrhage in Part 2, leading to updated trial criteria to exclude patients with superficial siderosis.

Placebo Response

The high placebo response rate in males was notable, where placebo achieved a 66.7% complete renal response compared to 42.9% for Gazyva.

Roche Holding Business Overview & Revenue Model

Company Description

Roche Holding AG engages in the pharmaceuticals and diagnostics businesses in Switzerland, Germany, the United States, Austria, Netherlands, the United Kingdom, France, Belgium, and internationally. The company offers pharmaceutical products for treating oncology, neuroscience, infectious, immunology, cardiovascular and metabolism, ophthalmology, and respiratory, as well as anemia, cancer, dermatology, hemophilia, inflammatory and autoimmune, neurological, and transplantation. It also offers in vitro tests for the diagnosis of various diseases, such as cancer, diabetes, Covid-19, hepatitis, human papillomavirus, and other diseases. In addition, the company supplies diagnostic instruments and reagents. The company was founded in 1896 and is headquartered in Basel, Switzerland.

How the Company Makes Money

Roche Holding AG generates revenue primarily through the sale of prescription pharmaceuticals and diagnostic products. In the Pharmaceuticals division, revenue is driven by key therapeutic areas such as oncology, where Roche is a market leader due to its innovative cancer treatments. The Diagnostics division contributes to revenue through the sale of instruments, reagents, and test kits used in disease detection and monitoring. Additionally, Roche has significant partnerships with research institutions and other pharmaceutical companies, which can provide collaborative revenue streams and enhance its research and development capabilities. The company's earnings are further supported by its global distribution network and a strong focus on research and development, allowing it to continually bring new and effective healthcare solutions to market.

Roche Holding Financial Statement Overview

Summary

Roche Holding has strong revenue growth and a solid gross profit margin, indicating efficient cost management. However, the decline in net income and return on equity, along with increased leverage, suggests some pressure on profitability. Strong cash flow generation provides a solid financial foundation despite these challenges.

Income Statement

Roche Holding has shown consistent revenue growth with a compound annual growth rate of approximately 1.33% over the past five years. The gross profit margin is strong, averaging around 72.5%, indicating efficient cost management. However, there has been a decline in net income, leading to a reduced net profit margin from 24.5% in 2020 to 13.3% in 2024. EBIT and EBITDA margins have been stable but slightly declining, which could indicate pressure on operational efficiency.

Balance Sheet

The company's equity ratio is solid at around 31.2%, reflecting a stable capital structure. The debt-to-equity ratio has increased due to rising total debt, but it remains manageable at approximately 1.14 in 2024. Return on equity has decreased from 39.4% in 2020 to 26.1% in 2024, suggesting a decline in profitability relative to shareholder equity. The balance sheet remains robust, but the increase in leverage warrants monitoring.

Cash Flow

Roche Holding's operating cash flow is strong, and the company maintains a healthy free cash flow to net income ratio, indicating efficient cash conversion. Free cash flow growth has been positive, but the growth rate has slowed, suggesting potential challenges in maintaining past growth levels. The operating cash flow to net income ratio is above 2, demonstrating strong cash generation capabilities relative to earnings.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	62.40B	60.44B	63.28B	62.80B	58.32B
Gross Profit	46.11B	44.08B	44.44B	43.10B	41.97B
EBITDA	16.62B	18.41B	20.80B	22.19B	22.97B
Net Income	8.28B	11.50B	12.42B	13.93B	14.29B
Balance Sheet
Total Assets	101.80B	90.47B	88.15B	92.32B	86.14B
Cash, Cash Equivalents and Short-Term Investments	17.32B	10.51B	9.77B	13.03B	12.33B
Total Debt	36.35B	30.78B	26.54B	32.55B	15.41B
Total Liabilities	65.64B	57.20B	56.14B	63.97B	46.37B
Stockholders Equity	31.77B	29.32B	27.99B	24.49B	36.34B
Cash Flow
Free Cash Flow	15.09B	11.45B	13.34B	16.02B	11.47B
Operating Cash Flow	20.09B	16.09B	17.89B	20.57B	18.16B
Investing Cash Flow	-11.39B	-10.64B	-3.57B	-6.55B	-9.08B
Financing Cash Flow	-6.82B	-4.24B	-15.72B	-12.70B	-9.24B

Roche Holding Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 38.84
• 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 RHHBY, the sentiment is Negative. The current price of 38.84 is below the 20-day moving average (MA) of 40.27, below the 50-day MA of 40.34, and above the 200-day MA of 38.74, indicating a neutral trend. The MACD of -0.20 indicates Positive momentum. The RSI at 38.08 is Neutral, neither overbought nor oversold. The STOCH value of 14.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RHHBY.

Roche Holding Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AZN	79 Outperform	$228.17B	27.55	19.76%	2.08%	15.17%	29.15%
MRK	79 Outperform	$196.16B	12.04	39.31%	4.04%	2.01%	―
JNJ	78 Outperform	$402.99B	17.90	30.21%	3.00%	4.69%	34.88%
NVS	76 Outperform	$222.51B	16.59	32.82%	3.46%	12.83%	-11.92%
RHHBY	74 Outperform	$257.51B	22.67	31.98%	3.51%	7.26%	-8.64%
SNY	73 Outperform	$113.81B	11.62	8.39%	4.73%	-9.32%	120.62%
Sector *	51 Neutral	$7.35B	0.50	-65.61%	2.47%	15.28%	1.44%