WX  WuXi PharmaTech (Cayman) Inc.

Exchange

NYSE

Sector

Consumer Durables

Industry

Major Pharmaceuticals

Market Cap.

3.26B

Vuru Grade

48.27/100

Current Price

$45.90
+0.045 (+0.098%)

Growth Price

$13.88
Overvalued by 69.77%

Stability Price

$8.41
Overvalued by 81.68%

Company Metrics

  • P/E 40.98
  • P/S 4.19
  • P/B 3.61
  • EPS 1.12
  • Cash ROIC 18.76%
  • Cash Ratio 1.16
  • Dividend 0 / 0%
  • Avg. Vol. 610,668.00
  • Shares 71.02M
  • Market Cap. 3.26B

Company Description

Wuxi PharmaTech (Cayman) Inc., through its subsidiaries, primarily engages in providing laboratory and manufacturing services to support research and development for pharmaceutical, biotechnology, and medical device companies. It operates in two segments, Laboratory Services and Manufacturing Services. The Laboratory Services segment offers various services for pharmaceutical companies, which incl... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

WuXi PharmaTech (Cayman) Inc. Announces Completion of Going Private Transaction
PR Newswire (press release) - Dec 10, 2015
10, 2015 /PRNewswire/ -- WuXi PharmaTech (Cayman) Inc. (NYSE: WX), a leading open-access R&D capability and technology platform company serving the pharmaceutical, biotechnology, and medical device industries with operations in China and the ...
JPMorgan's Top 100 Indexed Emerging Market ADRs
Seeking Alpha (blog) - Jan 12, 2009
Emerging market stocks were all the rage up until the middle of last year. Stocks from Brazil, India, Russia and China ((BRICs)) were gobbled up by investors like there was no tomorrow.
WuXi PharmaTech (WX) Stock Gains on Buyout Offer
TheStreet.com - Aug 14, 2015
"We rate WUXI PHARMATECH (CAYMAN)-ADR (WX) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we ...
Is Royal Gold, Inc USA) (RGLD) A Good Stock To Buy?
Insider Monkey (blog) - Dec 2, 2015
At the end of this article, we will also compare Royal Gold, Inc USA) (NASDAQ:RGLD) to other stocks, including WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX), MPLX LP (NYSE:MPLX), and American Eagle Outfitters (NYSE:AEO) to get a better sense of ...
Do Hedge Funds and Insiders Love Alere Inc (ALR)?
Insider Monkey (blog) - Aug 26, 2013
We'll check out the relationship between both of these indicators in other stocks similar to Alere Inc (NYSE:ALR). These stocks are PerkinElmer, Inc. (NYSE:PKI), WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX), PAREXEL International Corporation ...
Is Genomic Health, Inc. (GHDX) A Good Stock To Buy?
Insider Monkey (blog) - Nov 23, 2015
With market driven by short-term sentiment influenced by uncertainty regarding the future of the interest rate environment in the US, low commodity prices and economic turmoil in China, many smart money investors are keeping their optimism regarding ...
Mindray Medical Receives Reduced Management Buyout Proposal
Wall Street Journal - Sep 10, 2015
In the case of Mindray, the company's ADRs, which rose 25% on the initial buyout proposal in June, have declined 21% since then.
Somewhat Favorable Media Coverage Somewhat Unlikely to Impact UMB Financial ...
The Ledger Gazette - Sep 19, 2017
Raymond James Financial, Inc. raised UMB Financial Corporation from a “market perform” rating to an “outperform” rating in a research report on Thursday, August 10th.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for WX to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate WX's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$45.90 Current Price

$13.88 Growth Price (DCF)

Overvalued by 69.77%


Growth Rate Assumed by Market: 59.57%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$8.41 Stability Price (EPV)

Overvalued by 81.68%


Discount Rate: 15.0%

$3.94 NCA Price

Overvalued by 91.41%

$-451.32 Book Price

Overvalued by 1,083.26%


Excellent Cash Return on Invested Capital over the past 5 years

WX has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. Annual Reports can be useful in identifying the cause of one-time events and future sustainability.

WX has created $18.76 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20102011201220132014
Free Cash Flow 76.78M 24.35M 63.22M 121.36M 32.26M
divided by
Invested Capital 285.08M 321.68M 365.74M 363.62M 372.86M
Cash ROIC 26.93% 7.57% 17.29% 33.38% 8.65%

Excellent Return on Equity over the past 5 years

Over the past 5 years, WX has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

WX has generated $16.82 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20102011201220132014
Net Income 90.81M 80.98M 86.58M 114.57M 112.16M
divided by
Stockholders' Equity 392.83M 505.73M 578.22M 734.75M 777.85M
Return on Equity 23.12% 16.01% 14.97% 15.59% 14.42%

Good Business Performance over the past 10 years

It's likely WX has been unable to maintain profitability in tough economic times, making it a somewhat cyclical business. The other possibility is WX has expended significant capital on items such as property, plant and equipment in specific years. Look for correlations.

WX has created positive free cash flow for 7 or 8 of the past 10 years.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Free Cash Flow -49,226.00 -11.57M 24.26M -2.59M 14.78M 76.78M 24.35M 63.22M 121.36M 32.26M

Very Strong Balance Sheet

WX has more Cash than its Total Liabilities, resulting in $0.44 Net Cash per share. In other words, if you buy WX today, the price you're paying for shares is actually $45.46 because $0.44 of Cash is included in the current share price. This much Cash is very healthy. It can help WX sustain itself in the face of any economic turmoil and makes a stock buyback more of a possibility.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Cash 4.87M 9.68M 213.58M 71.26M 102.59M 153.49M 199.42M 229.38M 391.14M 434.99M
Current Assets 14.51M 36.65M 261.88M 129.77M 174.17M 244.92M 335.10M 395.96M 598.98M 683.66M
Total Assets 40.87M 85.69M 343.77M 336.40M 407.30M 498.13M 663.85M 742.54M 948.87M 1.18B
Current Liabilities 18.45M 30.59M 45.57M 58.80M 80.34M 59.57M 142.75M 147.42M 194.11M 373.78M
Total Liabilities 29.73M 86.62M 92.38M 105.52M 127.17M 105.30M 158.13M 164.31M 214.12M 403.77M
Stockholder' Equity 11.15M -927,625.00 251.40M 230.88M 280.13M 392.83M 505.73M 578.22M 734.75M 777.85M
Current Ratio 0.79 1.20 5.75 2.21 2.17 4.11 2.35 2.69 3.09 1.83
TL-to-TA 0.73 1.01 0.27 0.31 0.31 0.21 0.24 0.22 0.23 0.34

Low or No Reinvestment of Profits over the past 10 years

WX has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to WX operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Retained Earnings 311,569.00 -40.17M -57.30M -121.51M -68.63M 22.18M 103.16M 188.60M 303.17M 415.33M
Retained Earnings Growth - -12,993.84% -42.64% -112.04% 43.52% 132.32% 365.10% 82.83% 60.74% 36.99%

Inconsistent Net Profit Margins over the past 10 years

WX potentially has a competitive advantage, however inconsistent profit margins are a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$15.10 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Net Income 6.13M 8.85M 33.90M -64.20M 52.87M 90.81M 80.98M 86.58M 114.57M 112.16M
divided by
Revenue 33.78M 69.94M 135.20M 253.48M 270.02M 334.06M 407.18M 499.91M 578.08M 674.28M
Net Profit Margin 18.14% 12.66% 25.08% -25.33% 19.58% 27.18% 19.89% 17.32% 19.82% 16.63%

Varying Pricing Power over the past 10 years

WX has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. However, there is a substantial variation in their Gross Profit Margins from year-to-year, which indicates inconsistent performance. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$47.66 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Gross Profit 18.28M 34.31M 62.86M 96.34M 108.41M 127.59M 407.18M 183.24M 211.56M 251.74M
divided by
Revenue 33.78M 69.94M 135.20M 253.48M 270.02M 334.06M 407.18M 499.91M 578.08M 674.28M
Gross Margin 54.11% 49.06% 46.49% 38.01% 40.15% 38.19% 100.00% 36.65% 36.60% 37.34%

High Capital Intensity over the past 10 years

WX spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

117.01% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Capital Expenditure 9.11M 26.90M 40.97M 63.25M 54.99M 48.88M 76.72M 67.84M 60.14M 108.12M
divided by
Net Income 6.13M 8.85M 33.90M -64.20M 52.87M 90.81M 80.98M 86.58M 114.57M 112.16M
Capital Expenditure Ratio 148.63% 303.83% 120.85% -98.52% 104.01% 53.82% 94.74% 78.35% 52.50% 96.40%

Inconsistent Dividend History over the past 10 years

WX has started distributing dividends in the past couple years or has recently suspended their dividend distribution. The reliability of future distributions is unclear.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Dividend Paid 1.68M 6.75M - - - - - - - -
divided by
Shares Outstanding 274.75M 29.81M 64.39M 63.78M 73.65M 74.69M 75.44M 72.80M 72.75M 72.07M
Dividend Paid Per Share 0.01 0.23 - - - - - - - -
Price at Year End - - 30.97 7.85 16.05 16.33 11.04 15.75 38.00 33.73
Dividend Yield - - - - - - - - - -

History of Stock Buybacks over the past 10 years

WX has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2005200620072008200920102011201220132014
Shares Outstanding 274.75M 29.81M 64.39M 63.78M 73.65M 74.69M 75.44M 72.80M 72.75M 72.07M
Stock Bought Back - 821.55% -53.70% 0.97% -13.41% -1.39% -0.99% 3.63% 0.06% 0.94%
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