Organon & Co. logged a -0.5% change during today's morning session, and is now trading at a price of $19.73 per share.
Organon & Co. returned losses of -31.0% last year, with its stock price reaching a high of $32.43 and a low of $18.87. Over the same period, the stock underperformed the S&P 500 index by -43.0%. As of April 2023, the company's 50-day average price was $21.59. Organon & Co. develops and delivers health solutions through a portfolio of prescription therapies and medical devices within women's health in the United States and internationally. Based in Jersey City, NJ, the mid-cap Health Care company has 10,000 full time employees. Organon & Co. has offered a 5.6% dividend yield over the last 12 months.
Exceptional Profitability Overshadowed by Excessive Leverage:
| 2022-03-21 | 2023-02-27 | |
|---|---|---|
| Revenue (MM) | $6,304 | $6,174 |
| Gross Margins | 62.0% | 63.0% |
| Operating Margins | 30% | 28% |
| Net Margins | 21.0% | 15.0% |
| Net Income (MM) | $1,351 | $917 |
| Net Interest Expense (MM) | -$258 | -$422 |
| Depreciation & Amort. (MM) | -$195 | -$212 |
| Earnings Per Share | $5.31 | $3.59 |
| EPS Growth | n/a | -32.39% |
| Diluted Shares (MM) | 254 | 255 |
| Free Cash Flow (MM) | $2,345 | $1,047 |
| Capital Expenditures (MM) | -$185 | -$189 |
| Net Current Assets (MM) | -$8,429 | -$7,916 |
| Long Term Debt (MM) | $9,125 | $8,905 |
| Net Debt / EBITDA | 3.98 | 4.28 |
Organon & Co. has slimmer gross margins than its peers, declining EPS growth, and a highly leveraged balance sheet. On the other hand, the company has strong margins with a stable trend working in its favor. Furthermore, Organon & Co. has weak revenue growth and a flat capital expenditure trend, irregular cash flows, and a decent current ratio.
Organon & Co. Is Overvalued:
Organon & Co. has a trailing twelve month P/E ratio of 7.7, compared to an average of 24.45 for the Health Care sector. Based on its EPS guidance of $4.59, the company has a forward P/E ratio of 4.7. The company doesn't issue forward earnings guidance, and the compound average growth rate of its last 2 years of reported EPS is -27.5%. On this basis, the company's PEG ratio is -0.28, which indicates that its shares are overpriced.
Organon & Co. Has an Average Rating of Hold:
The 6 analysts following Organon & Co. have set target prices ranging from $23.0 to $43.0 per share, for an average of $31.0 with a hold rating. As of April 2023, the company is trading -30.4% away from its average target price, indicating that there is an analyst consensus of strong upside potential.
Organon & Co. has an average amount of shares sold short because 3.1% of the company's shares are sold short. Institutions own 79.8% of the company's shares, and the insider ownership rate stands at 0.1%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 12% stake in the company is worth $624,964,190.
