Fact based stock research
West Pharmaceutical Services (NYSE:WST)

US9553061055

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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West Pharmaceutical Services stock research in summary

westpharma.com


ANALYSIS: With an Obermatt Combined Rank of 45 (worse than 55% compared with investment alternatives), West Pharmaceutical Services (Life Sciences Tools & Services, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of West Pharmaceutical Services are low in value (priced high) with a consolidated Value Rank of 14 (worse than 86% of alternatives) and show below-average growth (Growth Rank of 31) but are safely financed (Safety Rank of 98), which means low debt burdens. ...read more


RECOMMENDATION: A Combined Rank of 45, is a hold recommendation based on West Pharmaceutical Services's financial characteristics. As the company West Pharmaceutical Services's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 14) and low growth (Obermatt Growth Rank of 31), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 98) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more


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Country USA
Industry Life Sciences Tools & Services
Index Dividends USA, D.J. US Medical, S&P 500
Size class Large

This stock has achievements: Top 10 Stock.

21-Mar-2024. Stock data may be delayed. Log in or sign up to get the most recent research.




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Research History: West Pharmaceutical Services

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
SENTIMENT
SENTIMENT
360° VIEW
360° VIEW

Most recent update of the stock research: 21-Mar-2024. Financial reporting date used for calculating ranks: 30-Sep-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better West Pharmaceutical Services is in the corresponding investment strategy.
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Combined financial peformance in Detail

ANALYSIS: With an Obermatt Combined Rank of 45 (worse than 55% compared with investment alternatives), West Pharmaceutical Services (Life Sciences Tools & Services, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of West Pharmaceutical Services are low in value (priced high) with a consolidated Value Rank of 14 (worse than 86% of alternatives) and show below-average growth (Growth Rank of 31) but are safely financed (Safety Rank of 98), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 45, is a hold recommendation based on West Pharmaceutical Services's financial characteristics. As the company West Pharmaceutical Services's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 14) and low growth (Obermatt Growth Rank of 31), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 98) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
COMBINED
COMBINED

Last update of combined financial performance: 21-Mar-2024. Stock analysis on combined financial performance: The higher the rank of West Pharmaceutical Services the better the performance.


Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 14 (worse than 86% compared with alternatives), West Pharmaceutical Services shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for West Pharmaceutical Services. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 78% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 7 which means that the stock price compared with what market professionals expect for future profits is higher than 93% of comparable companies, indicating a low value concerning West Pharmaceutical Services's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 18 which means that the stock price compared with what market professionals expect for future profit levels is higher than 82% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 9 is also low. Compared with invested capital, the stock price is higher than for 91% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 14, is a sell recommendation based on West Pharmaceutical Services's stock price compared with the company's operational size and dividend yields. Should dividend investors pick West Pharmaceutical Services? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose West Pharmaceutical Services only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more


VALUE METRICS 2021 2022 2023 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)
DIVIDEND YIELD
DIVIDEND YIELD
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE

Last update of Value Rank: 21-Mar-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of West Pharmaceutical Services; except for dividend yield where the rank is higher, the higher the yield.


Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), West Pharmaceutical Services shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for West Pharmaceutical Services. Sales Growth has a rank of 50 which means that currently professionals expect the company to grow more than 50% of its competitors. Stock Returns are also above average with a rank of 75. But Capital Growth has only a rank of 13, which means that currently professionals expect the company to grow its invested capital less than 87% of its competitors. Profit Growth is also low, with a rank of only 24, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 75% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS 2021 2022 2023 2024
REVENUE GROWTH
REVENUE GROWTH
PROFIT GROWTH
PROFIT GROWTH
CAPITAL GROWTH
CAPITAL GROWTH
STOCK RETURNS
STOCK RETURNS
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH

Last update of Growth Rank: 21-Mar-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of West Pharmaceutical Services.


Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 98 (better than 98% compared with alternatives) for 2024, the company West Pharmaceutical Services has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of West Pharmaceutical Services is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for West Pharmaceutical Services. Leverage is at a rank of 65, meaning the company has a below-average debt-to-equity ratio. It has less debt than 65% of its competitors. Liquidity is also good at a rank of 100, meaning the company generates more profit to service its debt than 100% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 20, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 80% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), West Pharmaceutical Services has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for West Pharmaceutical Services. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with West Pharmaceutical Services and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS 2021 2022 2023 2024
LEVERAGE
LEVERAGE
REFINANCING
REFINANCING
LIQUIDITY
LIQUIDITY
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY

Last update of Safety Rank: 21-Mar-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of West Pharmaceutical Services and the more cash is available to service its debt.


Sentiment Metrics in Detail

SENTIMENT 2021 2022 2023 2024
ANALYST OPINIONS
ANALYST OPINIONS
OPINIONS CHANGE
OPINIONS CHANGE
PRO HOLDINGS
PRO HOLDINGS
MARKET PULSE
MARKET PULSE
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT

Last update of Sentiment Rank: 21-Mar-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for West Pharmaceutical Services.
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Stock analysis by the purely fact based Obermatt Method for West Pharmaceutical Services from March 21, 2024.

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