SWX:LONN

Stock Analysis Report

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Executive Summary

Lonza Group Ltd supplies products and services to the pharmaceutical, biotech, and specialty ingredients markets worldwide.


Snowflake Analysis

Proven track record with adequate balance sheet.


Similar Companies

Share Price & News

How has Lonza Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LONN's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.0%

LONN

-0.4%

CH Life Sciences

1.4%

CH Market


1 Year Return

48.0%

LONN

50.2%

CH Life Sciences

3.6%

CH Market

Return vs Industry: LONN underperformed the Swiss Life Sciences industry which returned 51.1% over the past year.

Return vs Market: LONN exceeded the Swiss Market which returned 3.8% over the past year.


Shareholder returns

LONNIndustryMarket
7 Day-2.0%-0.4%1.4%
30 Day6.6%6.8%5.4%
90 Day20.9%24.3%1.0%
1 Year48.9%48.0%51.0%50.2%7.0%3.6%
3 Year141.3%135.1%103.8%99.6%20.3%8.0%
5 Year321.6%269.9%260.1%236.9%30.8%9.0%

Price Volatility Vs. Market

How volatile is Lonza Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lonza Group undervalued compared to its fair value and its price relative to the market?

45.57x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LONN (CHF468.6) is trading above our estimate of fair value (CHF261.14)

Significantly Below Fair Value: LONN is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: LONN is good value based on its PE Ratio (45.6x) compared to the Life Sciences industry average (62.6x).

PE vs Market: LONN is poor value based on its PE Ratio (45.6x) compared to the Swiss market (19.8x).


Price to Earnings Growth Ratio

PEG Ratio: LONN is poor value based on its PEG Ratio (3.1x)


Price to Book Ratio

PB vs Industry: LONN is overvalued based on its PB Ratio (5.4x) compared to the XE Life Sciences industry average (5.4x).


Next Steps

Future Growth

How is Lonza Group forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

14.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LONN's forecast earnings growth (14.8% per year) is above the savings rate (-0.2%).

Earnings vs Market: LONN's earnings (14.8% per year) are forecast to grow faster than the Swiss market (8.7% per year).

High Growth Earnings: LONN's earnings are forecast to grow, but not significantly.

Revenue vs Market: LONN's revenue (6.5% per year) is forecast to grow faster than the Swiss market (2.4% per year).

High Growth Revenue: LONN's revenue (6.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LONN's Return on Equity is forecast to be low in 3 years time (15.3%).


Next Steps

Past Performance

How has Lonza Group performed over the past 5 years?

26.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LONN has high quality earnings.

Growing Profit Margin: LONN's current net profit margins (12.9%) are higher than last year (11.8%).


Past Earnings Growth Analysis

Earnings Trend: LONN's earnings have grown significantly by 26.7% per year over the past 5 years.

Accelerating Growth: LONN's earnings growth over the past year (16.3%) is below its 5-year average (26.7% per year).

Earnings vs Industry: LONN earnings growth over the past year (16.3%) exceeded the Life Sciences industry 13.4%.


Return on Equity

High ROE: LONN's Return on Equity (11.6%) is considered low.


Next Steps

Financial Health

How is Lonza Group's financial position?


Financial Position Analysis

Short Term Liabilities: LONN's short term assets (CHF3.0B) exceed its short term liabilities (CHF2.7B).

Long Term Liabilities: LONN's short term assets (CHF3.0B) do not cover its long term liabilities (CHF4.6B).


Debt to Equity History and Analysis

Debt Level: LONN's debt to equity ratio (55.5%) is considered high.

Reducing Debt: LONN's debt to equity ratio has reduced from 107.5% to 55.5% over the past 5 years.

Debt Coverage: LONN's debt is well covered by operating cash flow (27%).

Interest Coverage: LONN's interest payments on its debt are well covered by EBIT (16.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Lonza Group's current dividend yield, its reliability and sustainability?

0.59%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: LONN's dividend (0.59%) isn’t notable compared to the bottom 25% of dividend payers in the Swiss market (1.94%).

High Dividend: LONN's dividend (0.59%) is low compared to the top 25% of dividend payers in the Swiss market (3.84%).


Stability and Growth of Payments

Stable Dividend: LONN is not paying a notable dividend for the Swiss market, therefore no need to check if payments are stable.

Growing Dividend: LONN is not paying a notable dividend for the Swiss market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: LONN is not paying a notable dividend for the Swiss market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of LONN's dividend in 3 years as they are not forecast to pay a notable one for the Swiss market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.9yrs

Average management tenure


CEO

Albert Baehny (67yo)

0.58

Tenure

CHF626,888

Compensation

Mr. Albert M. Baehny has been Vice Chairman of Investis Holding SA. Mr. Baehny has been an Interim Chief Executive Officer of Lonza Group Ltd. since November 12, 2019. He serves as the Chief Executive Offi ...


Leadership Team

NamePositionTenureCompensationOwnership
Albert Baehny
Chairman & Interim CEO0.58yrCHF626.89k0.0042% CHF1.4m
Rodolfo Savitzky
Chief Financial Officer3.67yrsno data0.015% CHF5.2m
Dirk Oehlers
Head of Investor Relationsno datano datano data
Victoria Morgan
Head of Corporate Communicationsno datano datano data
Joseph Colleluori
Senior Vice President of Corporate Development14.42yrsno datano data
Jennifer Clancy
Senior Director of Global Marketing2.17yrsno datano data
Caroline Barth
Chief Human Resources Officer0.083yrno datano data
Aurelie Dalbiez
Head of Strategic HR Projects & Interim CHROno datano datano data
Constance Ward
Head of External Communicationsno datano datano data
Sven Abend
Chief Operating Officer of Specialty Ingredients Segment5.92yrsno data0.0067% CHF2.3m

2.9yrs

Average Tenure

57yo

Average Age

Experienced Management: LONN's management team is considered experienced (2.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Albert Baehny
Chairman & Interim CEO0.58yrCHF626.89k0.0042% CHF1.4m
Barbara Richmond
Independent Non-Executive Director6.17yrsCHF270.46k0.0058% CHF2.0m
Christoph Mäder
Lead Independent Director0.58yrCHF292.42k0.0042% CHF1.5m
Werner Bauer
Independent Director7.17yrsCHF249.35k0.035% CHF12.3m
Jürgen Steinemann
Independent Director6.17yrsCHF238.94k0.0093% CHF3.2m
Dorothée Deuring
Independent Director0.17yrno datano data
Angelica Kohlmann
Independent Director2.08yrsCHF250.21k0.00080% CHF278.5k
Olivier Verscheure
Independent Director2.08yrsCHF250.21k0.00080% CHF278.5k

2.1yrs

Average Tenure

59.5yo

Average Age

Experienced Board: LONN's board of directors are not considered experienced ( 2.1 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lonza Group Ltd's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lonza Group Ltd
  • Ticker: LONN
  • Exchange: SWX
  • Founded: 1897
  • Industry: Life Sciences Tools and Services
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: CHF34.812b
  • Shares outstanding: 74.29m
  • Website: https://www.lonza.com

Number of Employees


Location

  • Lonza Group Ltd
  • Muenchensteinerstrasse 38
  • Basel
  • Basel-Stadt
  • 4002
  • Switzerland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LZAG.FOTCPK (Pink Sheets LLC)YesRegistered SharesUSUSDNov 1999
LONNSWX (SIX Swiss Exchange)YesRegistered SharesCHCHFNov 1999
LO3DB (Deutsche Boerse AG)YesRegistered SharesDEEURNov 1999
0QNOLSE (London Stock Exchange)YesRegistered SharesGBCHFNov 1999
LZAG.YOTCPK (Pink Sheets LLC)UNSPONSORED ADRUSUSDOct 2008

Biography

Lonza Group Ltd supplies products and services to the pharmaceutical, biotech, and specialty ingredients markets worldwide. The company operates through two segments, Pharma Biotech & Nutrition, and Specialty Ingredients. The Pharma Biotech & Nutrition segment provides technology platforms, including drug substance and drug product; and develops and manufactures customized active pharmaceutical ingredients and biopharmaceuticals, as well as formulation services and delivery systems for pharmaceutical and nutritional applications. It serves pharmaceutical companies, biotechnology firms, and medical research and testing organizations, as well as consumer health and nutrition companies. The Specialty Ingredients segment operates microbial control solutions and specialty chemical services businesses. Its Microbial control solutions business has offerings in professional hygiene, and home and personal care markets; and offerings in paints and coating, wood protection, material protection, and crop protection. This segments also offers specialty chemicals in electronics, aerospace, food and feed ingredients, agro chemicals, and diversified specialty chemicals markets. The company has collaboration with Moderna, Inc. to manufacture a potential COVID-19 vaccine, mRNA-1273. Lonza Group Ltd was founded in 1897 and is headquartered in Basel, Switzerland. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/04 21:29
End of Day Share Price2020/06/04 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.