NYSE:EBS

Stock Analysis Report

Executive Summary

Emergent BioSolutions Inc., a life sciences company, focuses on the provision of specialty products for civilian and military populations that address accidental, intentional, and naturally occurring public health threats (PHTs).

Rewards

Earnings are forecast to grow 26.98% per year

Risk Analysis

Interest payments are not well covered by earnings

Large one-off items impacting financial results

Profit margins (0.4%) are lower than last year (14.2%)

Shareholders have been diluted in the past year



Snowflake Analysis

Moderate growth potential and overvalued.


Similar Companies

Achillion Pharmaceuticals

NasdaqGS:ACHN

Share Price & News

How has Emergent BioSolutions's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-5.5%

EBS

0.2%

US Biotechs

0.6%

US Market


1 Year Return

-14.7%

EBS

17.8%

US Biotechs

20.8%

US Market

Return vs Industry: EBS underperformed the US Biotechs industry which returned 17.8% over the past year.

Return vs Market: EBS underperformed the US Market which returned 20.8% over the past year.


Shareholder returns

EBSIndustryMarket
7 Day-5.5%0.2%0.6%
30 Day-4.4%9.3%2.5%
90 Day-0.06%15.9%4.9%
1 Year-14.7%-14.7%18.8%17.8%23.5%20.8%
3 Year44.8%44.8%27.1%22.9%46.5%37.0%
5 Year105.3%92.1%3.0%-2.1%64.6%46.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Emergent BioSolutions undervalued compared to its fair value and its price relative to the market?

649.31x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: EBS ($51.97) is trading above our estimate of fair value ($31.77)

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


Price To Earnings Ratio

PE vs Industry: EBS is poor value based on its PE Ratio (649.3x) compared to the Biotechs industry average (18.7x).

PE vs Market: EBS is poor value based on its PE Ratio (649.3x) compared to the US market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: EBS is poor value based on its PEG Ratio (24.1x)


Price to Book Ratio

PB vs Industry: EBS is good value based on its PB Ratio (2.6x) compared to the US Biotechs industry average (3.3x).


Next Steps

Future Growth

How is Emergent BioSolutions forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

27.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EBS's forecast earnings growth (27% per year) is above the savings rate (1.7%).

Earnings vs Market: EBS's earnings (27% per year) are forecast to grow faster than the US market (14.4% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: EBS's revenue (6.5% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: EBS'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: EBS's Return on Equity is forecast to be low in 3 years time (13.3%).


Next Steps

Past Performance

How has Emergent BioSolutions performed over the past 5 years?

-6.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: EBS has a large one-off loss of $20.8M impacting its September 30 2019 financial results.

Growing Profit Margin: EBS's current net profit margins (0.4%) are lower than last year (14.2%).


Past Earnings Growth Analysis

Earnings Trend: EBS's earnings have declined by -6% per year over the past 5 years.

Accelerating Growth: EBS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: EBS had negative earnings growth (-95.9%) over the past year, making it difficult to compare to the Biotechs industry average (103.3%).


Return on Equity

High ROE: EBS's Return on Equity (0.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Emergent BioSolutions's financial position?


Financial Position Analysis

Short Term Liabilities: EBS's short term assets ($700.0M) exceed its short term liabilities ($275.3M).

Long Term Liabilities: EBS's short term assets ($700.0M) do not cover its long term liabilities ($1.0B).


Debt to Equity History and Analysis

Debt Level: EBS's debt to equity ratio (80%) is considered high.

Reducing Debt: EBS's debt to equity ratio has increased from 48.9% to 80% over the past 5 years.

Debt Coverage: EBS's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: EBS's interest payments on its debt are not well covered by EBIT (1.8x coverage).


Balance Sheet

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

Debt Coverage by Assets: EBS's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

What is Emergent BioSolutions's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.1%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate EBS's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate EBS's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if EBS's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if EBS's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

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


Next Steps

Management

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

2.6yrs

Average management tenure


CEO

Bob Kramer (62yo)

0.7yrs

Tenure

US$2,212,484

Compensation

Mr. Robert G. Kramer, Sr., also known as Bob, has been President at Emergent BioSolutions Inc. since March 26, 2018 and has been its Chief Executive Officer and Director since April 01, 2019. Mr. Kramer wa ...


CEO Compensation Analysis

Compensation vs Market: Bob's total compensation ($USD2.21M) is below average for companies of similar size in the US market ($USD5.10M).

Compensation vs Earnings: Bob's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

2.6yrs

Average Tenure

55yo

Average Age

Experienced Management: EBS's management team is considered experienced (2.6 years average tenure).


Board Age and Tenure

6.4yrs

Average Tenure

68.5yo

Average Age

Experienced Board: EBS's board of directors are considered experienced (6.4 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$447,72813 Dec 19
Sue Bailey
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares8,375
Max PriceUS$53.46
SellUS$54,31419 Nov 19
Kathryn Zoon
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$54.31
SellUS$84,69210 Sep 19
Kathryn Zoon
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,509
Max PriceUS$56.12

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.7%.


Management Team

  • Richard Lindahl (55yo)

    Executive VP

    • Tenure: 1.8yrs
    • Compensation: US$1.69m
  • Fuad El-Hibri (61yo)

    Founder & Executive Chairman of the Board

    • Tenure: 15.5yrs
    • Compensation: US$2.70m
  • Bob Kramer (62yo)

    CEO, President & Director

    • Tenure: 0.7yrs
    • Compensation: US$2.21m
  • Robert Burrows

    Vice President of Investor Relations

    • Tenure: 13.5yrs
  • Sharon Solomon

    Senior VP & Chief Information Officer

    • Tenure: 0yrs
  • Atul Saran (46yo)

    Executive VP of Corporate Development

    • Tenure: 2.6yrs
    • Compensation: US$1.70m
  • Adam Havey (48yo)

    Executive VP of Business Operations

    • Tenure: 0yrs
    • Compensation: US$1.66m
  • Sean Kirk

    Executive Vice President of Manufacturing & Technical Operations

    • Tenure: 0.7yrs
  • Laura Kennedy

    Senior VP and Chief Ethics & Compliance Officer

    • Tenure: 3.3yrs
  • Lynn Kieffer

    Vice President of Corporate Communications

    • Tenure: 0yrs

Board Members

  • Seamus Mulligan (59yo)

    Director

    • Tenure: 0.8yrs
  • Louis Sullivan (86yo)

    Independent Director

    • Tenure: 13.5yrs
    • Compensation: US$346.50k
  • George Joulwan (80yo)

    Independent Director

    • Tenure: 6.4yrs
    • Compensation: US$338.00k
  • Ron Richard (63yo)

    Lead Independent Director

    • Tenure: 0yrs
    • Compensation: US$382.50k
  • Fuad El-Hibri (61yo)

    Founder & Executive Chairman of the Board

    • Tenure: 15.5yrs
    • Compensation: US$2.70m
  • Bob Kramer (62yo)

    CEO, President & Director

    • Tenure: 0.7yrs
    • Compensation: US$2.21m
  • Jerome Hauer (67yo)

    Independent Director

    • Tenure: 4.9yrs
    • Compensation: US$346.50k
  • Zsolt Harsanyi (75yo)

    Independent Director

    • Tenure: 15.3yrs
    • Compensation: US$354.00k
  • Sue Bailey (75yo)

    Independent Director

    • Tenure: 12.5yrs
    • Compensation: US$332.00k
  • Kathryn Zoon (70yo)

    Independent Director

    • Tenure: 3.1yrs
    • Compensation: US$334.44k

Company Information

Emergent BioSolutions Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Emergent BioSolutions Inc.
  • Ticker: EBS
  • Exchange: NYSE
  • Founded: 1998
  • Industry: Biotechnology
  • Sector: Pharmaceuticals & Biotech
  • Market Cap: US$2.683b
  • Shares outstanding: 51.62m
  • Website: https://www.emergentbiosolutions.com

Number of Employees


Location

  • Emergent BioSolutions Inc.
  • 400 Professional Drive
  • Suite 400
  • Gaithersburg
  • Maryland
  • 20879
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EBSNYSE (New York Stock Exchange)YesCommon StockUSUSDNov 2006
ER4DB (Deutsche Boerse AG)YesCommon StockDEEURNov 2006
0IGALSE (London Stock Exchange)YesCommon StockGBUSDNov 2006

Biography

Emergent BioSolutions Inc., a life sciences company, focuses on the provision of specialty products for civilian and military populations that address accidental, intentional, and naturally occurring publi ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/14 00:24
End of Day Share Price2019/12/13 00:00
Earnings2019/09/30
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.