AstraZeneca was a driving force behind tackling the Covid-19 pandemic with their vaccine roll-out, but is the company’s stock worth considering in 2022?
Despite enjoying a jump in revenue over the past year, AstraZeneca shares are up just 1% year to date.
The company reported strong financial results for 2021 with a revenue increase of 41% to $37,417 million.
AstraZeneca Dividend
AstraZeneca paid out a dividend of $2.87 per share for its 2021 financial year, which was well covered with a dividend cover of 1.9 and provides space for further dividend increases.
AstraZeneca currently has a 2.8% yield, broadly inline the FTSE 100 average.
The pharma producer saw an EPS of $0.08 for 2021, representing a dramatic 97% decrease compared to 2020.
“AstraZeneca continued on its strong growth trajectory in 2021, with industry-leading R&D productivity, five of our medicines crossing new blockbuster thresholds and the acquisition and integration of Alexion,” said AstraZeneca CEO Pascal Soriot.
“We also delivered on our promise of broad and equitable access to our Covid-19 vaccine with 2.5 billion doses released for supply around the world, and we made good progress on reducing our greenhouse gas emissions.”
“Growth was well balanced across our strategic areas of focus, and we saw double-digit growth in all major regions, including Emerging Markets despite some headwinds in China.”
AstraZeneca has also been engaged in deal making this year with a $760 million heart medicine agreement.
AstraZeneca Valuation
AstraZeneca’s historical PE Ratio is 22.5 which is forecast to fall to 17x earnings suggesting analysts are optimistic about the company’s outlook.
However, when compared to FTSE 100 peers GlaxoSmithKline and Hikma, Astra does appear expensive. GlaxoSmithKline and Hikma both have forward PE Ratios of 12.7.
This may pay testament to investor sentiment around AstraZeneca who are the best performing FTSE 100 Pharma so far in 2022 with shares up 1.1%. Glaxo shares are down 6.3%.
With Astra’s strong pipeline of drugs, and the strong sentiment around AstraZeneca leading to a premium when compared to peers, the AstraZeneca share price should be one to watch for an entry on further weakness.