Summary
Regeneron Pharmaceuticals has much money and the debt ratio is very lower.
The firm’ financial performance fluctuate substantially, which trigger the fluctuation of the stock price.
The company value the price of stock.
We reckon that $734 per share is a good buy point ,or market capitalization reach $80 billion.
Asset structure analysis
As of September 30,2023, Regeneron Pharmaceuticals’ s total assets reached $32.1 billion ,with compared $29.2 billion as of September 30,2022.
As of September 30,2023,total current asset was $18.6 billion ,which accounted for 57.9% of total assets($32.1 billion).
We are glad that the firm have good asset structure and lower debt.
As of September 30,2023,the combined of cash and cash equivalents and market securities was $9.9 billion ,which make up 30.8% of total assets($32.1 billion).
As of September 30,2023,inventory was $2.5 billion, which consist of 7.8% of total assets.
As of September 30,2023, accounts receivable, net was $5.5 billion, which represents 17.3% of total assets($32.1 billion).
As of September 30,2023,total liabilities were $7.2 billion ,and we can get a debt ratio of 22.4%,which is a very lower number, especially in the pharmaceutical industry.
Because the firm’s debt ratio is lower, it would have much acquisition opportunities.
Profitability analysis
Regeneron Pharmaceuticals reported $9.68 billion in revenues in the nine months ended September 30,2023, up from $8.75 billion in the same period of last year. The increase in revenues was $0.93 billion or 10.6%.
We need to see that whether net profit has increased proportionally.
Net income was $2.79 billion in the nine months ended September 30,2023,down $0.35 billion(-11.2%)from $3.1 billion in the nine ended September 30,2022.
Net income dose not increase but drop ,while revenues is up 10.6%.
The increase in research and development was $0.72 billion or 28.3%,from $2.54 billion in the nine months ended September 30,2023.
Selling, general, and administrative was up $0.44 billion or 30%.
The increasing cost have contributed a drop of net profit.
We look at the firm’s 2022 financial statement. it reported revenues of $12.1 billion, $16 billion and $8.49 billion in 2022,in 2021 and in 2020,respectively. We can find out that the company ’revenues is very unstable, which lead to the difficulty of estimating value of the firm.
It generated net income of $4.3 billion ,$8.0 billion and $3.5 billion in 2022,in 2021 and in 2020,respectively.The company’s profitability is strong.
The quality of earnings was is very high, because net cash flow provided operating activities reached $5 billion,$7.0 billion and 2.6 billion in 2022,in 2021 and in 2020,respectively.
Total stockholder’s equity was $22.6 billion in 2022,and we could get return on equity of 20%,which is a high rate of return. That would been higher than 20% ,if the firm had not much cash.
Cash flow analysis
Regeneron Pharmaceuticals reported capital expenditure of $0.59 billion,$0.55 billion, and $0.61 billion in 2022.in 2021 and in 2020.
Free cash flow was $4.4 billion ,$65.3 billion and $20 billion in 2022,in 2021 and 2020,respectively.
What beat me that the number of issuance of common stock turn up on the statement of cash flow, while repurchases of common exist.
We could find out that the company has never paid dividends to stockholder.
