Dr. Reddy's Laboratories may be undervalued with mixed growth prospects, but the 5 analysts following the company give it an rating of hold. Their target prices range from $13.08432 to $19.443024 per share, for an average of $15.42. At today's price of $14.16, Dr. Reddy's Laboratories is trading -8.16% away from its average target price, suggesting there is an analyst consensus of some upside potential for the stock.
Dr. Reddy's Laboratories Limited, together with its subsidiaries, operates as an integrated pharmaceutical company worldwide. Based in Hyderabad, India, the Large-Cap Health Care company has 27,048 full time employees. Dr. Reddy's Laboratories has offered a 53.0% dividend yield over the last 12 months.
Dr. Reddy's Laboratories has a trailing twelve month P/E ratio of 18.4, compared to an average of 26.07 for the Health Care sector. Considering its EPS guidance of $0.87, the company has a forward P/E ratio of 16.3.
On the other hand, the market is potentially undervaluing Dr. Reddy's Laboratories in terms of its book value because its P/B ratio is 0.04. In comparison, the sector average P/B ratio is 3.53. The company's shares are currently -66.8% above their Graham number, which suggests that they are not trading at a fair value in terms of earnings and net assets.
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $2,225 | $2,316 | $2,594 | $2,826 | $2,992 | $3,350 |
| Gross Margins | 54% | 54% | 54% | 53% | 56% | 59% |
| Net Margins | 12% | 11% | 9% | 11% | 18% | 20% |
| Net Income (M) | $272 | $259 | $236 | $311 | $548 | $668 |
| Net Interest Expense (M) | $889 | $983 | $970 | $958 | $1,428 | $1,711 |
| Depreciation & Amort. (M) | $176 | $165 | $175 | $156 | $154 | $178 |
| Diluted Shares (M) | 166 | 166 | 166 | 166 | 167 | 167 |
| Earnings Per Share | $1.64 | $1.56 | $1.52 | $1.87 | $3.3 | $4.01 |
| Free Cash Flow (M) | $314 | $379 | $355 | $177 | $578 | $545 |
| CAPEX (M) | $101 | $17 | $133 | $193 | $138 | n/a |
| Total Debt (M) | $318 | $17 | $86 | $76 | $16 | $72 |
| Net Debt / EBITDA | 0.6 | -0.03 | -0.23 | -0.22 | -0.06 | -0.01 |
| Current Ratio | 1.92 | 1.79 | 1.78 | 1.93 | 2.41 | 2.58 |
