LSE:HIK

Stock Analysis Report

Executive Summary

Hikma Pharmaceuticals PLC develops, manufactures, and markets a range of generic, branded, and in-licensed pharmaceutical products.

Snowflake

Fundamentals

Flawless balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Hikma Pharmaceuticals's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HIK has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.4%

HIK

0.2%

GB Pharmaceuticals

-0.2%

GB Market


1 Year Return

13.4%

HIK

13.7%

GB Pharmaceuticals

4.7%

GB Market

Return vs Industry: HIK exceeded the UK Pharmaceuticals industry which returned 13.7% over the past year.

Return vs Market: HIK exceeded the UK Market which returned 4.7% over the past year.


Shareholder returns

HIKIndustryMarket
7 Day0.4%0.2%-0.2%
30 Day-4.1%5.3%0.8%
90 Day-7.3%0.07%3.7%
1 Year15.3%13.4%18.3%13.7%10.1%4.7%
3 Year18.1%12.2%53.9%34.9%20.9%5.6%
5 Year4.0%-3.2%68.4%33.4%32.3%2.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Hikma Pharmaceuticals undervalued compared to its fair value and its price relative to the market?

13.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HIK (£18.85) is trading below our estimate of fair value (£21.7)

Significantly Below Fair Value: HIK is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: HIK is good value based on its PE Ratio (16.3x) compared to the Pharmaceuticals industry average (18.4x).

PE vs Market: HIK is good value based on its PE Ratio (16.3x) compared to the UK market (17.2x).


Price to Earnings Growth Ratio

PEG Ratio: HIK is poor value based on its PEG Ratio (2.7x)


Price to Book Ratio

PB vs Industry: HIK is overvalued based on its PB Ratio (3.2x) compared to the GB Pharmaceuticals industry average (2.5x).


Next Steps

Future Growth

How is Hikma Pharmaceuticals forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

6.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HIK's forecast earnings growth (6% per year) is above the savings rate (1.2%).

Earnings vs Market: HIK's earnings (6% per year) are forecast to grow slower than the UK market (12.5% per year).

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

Revenue vs Market: HIK's revenue (4.8% per year) is forecast to grow faster than the UK market (3.6% per year).

High Growth Revenue: HIK's revenue (4.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HIK's Return on Equity is forecast to be low in 3 years time (16.9%).


Next Steps

Past Performance

How has Hikma Pharmaceuticals performed over the past 5 years?

-32.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HIK has high quality earnings.

Growing Profit Margin: HIK became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: HIK's earnings have declined by -32.2% per year over the past 5 years.

Accelerating Growth: HIK has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: HIK has become profitable in the last year, making it difficult to compare its past year earnings growth to the Pharmaceuticals industry (6.9%).


Return on Equity

High ROE: HIK's Return on Equity (19.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Hikma Pharmaceuticals's financial position?


Financial Position Analysis

Short Term Liabilities: HIK's short term assets ($1.7B) exceeds its short term liabilities ($1.3B)

Long Term Liabilities: HIK's short term assets ($1.7B) exceeds its long term liabilities (438.0M)


Debt to Equity History and Analysis

Debt Level: HIK's debt to equity ratio (34.1%) is considered satisfactory.

Reducing Debt: HIK's debt to equity ratio has reduced from 37.9% to 34.1% over the past 5 years.

Debt Coverage: HIK's debt is well covered by operating cash flow (68.8%).

Interest Coverage: HIK's interest payments on its debt are well covered by EBIT (12.9x coverage).


Balance Sheet

Inventory Level: HIK has a high level of physical assets or inventory.

Debt Coverage by Assets: HIK's debt is covered by short term assets (assets are 2.7x debt).


Next Steps

Dividend

What is Hikma Pharmaceuticals's current dividend yield, its reliability and sustainability?

1.56%

Current Dividend Yield


Dividend Yield vs Market

company1.6%marketbottom25%2.0%markettop25%5.3%industryaverage3.7%forecastin3Years1.8%

Current dividend yield vs market & industry

Notable Dividend: HIK's dividend (1.56%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.97%).

High Dividend: HIK's dividend (1.56%) is low compared to the top 25% of dividend payers in the UK market (5.33%).


Stability and Growth of Payments

Stable Dividend: HIK's dividends per share have been stable in the past 10 years.

Growing Dividend: HIK's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (26.8%), HIK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HIK's dividends in 3 years are forecast to be well covered by earnings (27.1% payout ratio).


Next Steps

Management

What is the CEO of Hikma Pharmaceuticals's salary, the management and board of directors tenure and is there insider trading?

1.8yrs

Average management tenure


CEO

Siggi Olafsson (50yo)

1.8yrs

Tenure

US$5,418,510

Compensation

Mr. Sigurdur Oli Olafsson, Ph.D., also known as Siggi, has been Chief Executive Officer of Hikma Pharmaceuticals PLC since February 20, 2018 and serves its Executive Director since March 2018. Mr. Olafsson ...


CEO Compensation Analysis

Compensation vs Market: Siggi's total compensation ($USD5.42M) is above average for companies of similar size in the UK market ($USD3.42M).

Compensation vs Earnings: Insufficient data to compare Siggi's compensation with company performance.


Management Age and Tenure

1.8yrs

Average Tenure

54yo

Average Age

Experienced Management: HIK's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Age and Tenure

5.5yrs

Average Tenure

61yo

Average Age

Experienced Board: HIK's board of directors are considered experienced (5.5 years average tenure).


Insider Trading

Insider Buying: HIK insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$3,011,12106 Sep 19
Said Samih Darwazah
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares150,000
Max PriceUS$20.56
SellUS$885,80013 Aug 19
Khalid Walid Nabilsi
EntityIndividual
Role
Chief Financial Officer
Chief Financial Officer
Shares45,000
Max PriceUS$19.79
SellUS$1,662,99013 Aug 19
Bassam Rushdi Kanaan
EntityIndividual
Role
Head of Corporate Development
Executive Vice President of Corporate Development and M&A
Shares84,500
Max PriceUS$19.79
BuyUS$31,26115 Mar 19
Mary Henderson
EntityIndividual
Shares2,000
Max PriceUS$15.63
BuyUS$316,39613 Mar 19
Mazen Samih Darwazah
EntityIndividual
Role
Vice Chairman
Executive Vice Chairman & President of MENA
Shares20,000
Max PriceUS$15.82
BuyUS$318,33213 Mar 19
Said Samih Darwazah
EntityIndividual
Role
Chairman of the Board
Executive Chairman
Shares20,000
Max PriceUS$15.92

Ownership Breakdown

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


Management Team

  • Said Samih Darwazah (62yo)

    Executive Chairman

    • Tenure: 5.5yrs
    • Compensation: US$4.50m
  • Mazen Samih Darwazah (61yo)

    Executive Vice Chairman & President of MENA

    • Tenure: 14.8yrs
    • Compensation: US$3.01m
  • Siggi Olafsson (50yo)

    CEO & Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$5.42m
  • Susan Ringdal

    Executive Vice President of Strategic Planning & Global Affairs

    • Tenure: 1.8yrs
  • Bassam Rushdi Kanaan (54yo)

    Executive Vice President of Corporate Development and M&A

    • Tenure: 5.7yrs
  • Majda Labadi

    Executive Vice President of Organisational Development

    • Tenure: 1.8yrs
  • Khalid Walid Nabilsi (47yo)

    Chief Financial Officer

    • Tenure: 8.8yrs
  • Riad Mishlawi

    President of Injectables

    • Tenure: 1.8yrs
  • Brian Hoffmann

    President of US Generics

    • Tenure: 2.4yrs
  • Shahin Fesharaki

    Chief Scientific Officer & Global Head of Research Development

    • Tenure: 0.3yrs

Board Members

  • Pam Kirby (66yo)

    Independent Non-Executive Director

    • Tenure: 4.9yrs
    • Compensation: US$101.00k
  • Robert Pickering (59yo)

    Senior Independent Director

    • Tenure: 5.5yrs
    • Compensation: US$101.00k
  • John Castellani (68yo)

    Independent Non-Executive Director

    • Tenure: 3.7yrs
    • Compensation: US$107.30k
  • Said Samih Darwazah (62yo)

    Executive Chairman

    • Tenure: 5.5yrs
    • Compensation: US$4.50m
  • Mohammed Ali Khaldoun Al-Husry (62yo)

    Non-Executive Director

    • Tenure: 14.1yrs
    • Compensation: US$87.50k
  • Mazen Samih Darwazah (61yo)

    Executive Vice Chairman & President of MENA

    • Tenure: 14.8yrs
    • Compensation: US$3.01m
  • Siggi Olafsson (50yo)

    CEO & Executive Director

    • Tenure: 1.8yrs
    • Compensation: US$5.42m
  • Nabil Rizk

    Chairman of West-ward Pharmaceuticals

    • Tenure: 0yrs
  • Pat Butler (59yo)

    Independent Non-Executive Director

    • Tenure: 5.6yrs
    • Compensation: US$109.00k
  • Jochen Gann (54yo)

    Non-Executive Director

    • Tenure: 3.8yrs
    • Compensation: US$86.60k

Company Information

Hikma Pharmaceuticals PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Hikma Pharmaceuticals PLC
  • Ticker: HIK
  • Exchange: LSE
  • Founded: 1978
  • Industry: Pharmaceuticals
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: UK£4.565b
  • Shares outstanding: 242.26m
  • Website: https://www.hikma.com

Number of Employees


Location

  • Hikma Pharmaceuticals PLC
  • 1 New Burlington Place
  • London
  • Greater London
  • W1S 2HR
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HIKLSE (London Stock Exchange)YesOrdinary SharesGBGBPNov 2005
H5PDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 2005
HKMP.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 2005
HIKLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPNov 2005
HIK NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNNov 2005
HIKDIFX (NASDAQ Dubai Limited)GDR EACH REPR 2 ORD GBP0.10AEUSDJun 2007
HKMP.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDNov 2009

Biography

Hikma Pharmaceuticals PLC develops, manufactures, and markets a range of generic, branded, and in-licensed pharmaceutical products. It operates through three segments: Injectables, Generics, and Branded. T ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/21 20:53
End of Day Share Price2019/11/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.