AstraZeneca PLC

AstraZeneca PLC (LON: AZN) is an FTSE 100 listed science-led biopharmaceutical company, which focuses on the development, commercialisation, and discovery of prescription medicines.

On 12 November 2021, AZN will release Q3 FY21 results.

Investment Rationale for Valuation – EXPENSIVE at GBX 9,340.00

• Weak Profitability: On the profitability front, the operating margin and the net margin remained lower than the respective industry median of 22.6% and 6.7% during Q2 FY21.
• Higher Leverage: The debt-equity ratio of 1.75x remained more than the industry median of 0.35x during Q2 FY21.
• Trading near 52 weeks high: AZN is currently trading very close to the 52-week high, making it difficult for the stock to show any further upside potential.
• Unfavourable Technical Indicator: From a technical standpoint, AZN is hovering around the upper Bollinger band, indicating a correction in the stock price.
• Relative Strength Index: The 14-days RSI of ~67.97 approaches overbought territory

One Year Share Price Chart 

(Source: REFINITIV; Research done by Kalkine Group)

Conclusion

Based on the overstretched valuations, lower profitability margins than the industry median and unfavourable technical indicators we have given an “EXPENSIVE” recommendation on AstraZeneca PLC at the closing market price of GBX 9,340.00 (as on 03 November 2021) while we will suggest fresh buying after analysing Q3 FY21 results releasing soon.

*The reference data in this report has been partly sourced from REFINITIV.

*Dividend Yield may vary as per the stock price movement.

Disclaimer

References to ‘Kalkine’, ‘we’, ‘our’ and ‘us’ refer to Kalkine Limited.

This website is a service of Kalkine Limited. Kalkine Limited is a private limited company, incorporated in England and Wales with registration number 07903332. Kalkine Limited is authorised and regulated by the Financial Conduct Authority under reference number 579414.

The article has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. No advice or information, whether oral or written, obtained by you from Kalkine or through or from the service shall create any warranty not expressly stated. Kalkine does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation.

Kalkine does not offer financial advice based upon your personal financial situation or goals, and we shall NOT be held liable for any investment or trading losses you may incur by using the opinions expressed in our publications, market updates, news alerts and corporate profiles. Kalkine does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. Kalkine’s non-personalised advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested.

Kalkine Media Limited, an affiliate of Kalkine Limited, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.