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Roche Holding AG

Published:01 May 2023 17:48 CET

Analyst:

Nadiia D, Content Manager, nadiia.d@adviscent.com

Investment Case

The ‘AA’ rating reflects Roche Holding Ltd’s strong business profile, characterised by its leading market position in profitable and growing specialist therapeutic areas such as oncology, diagnostic products, immunology and neurology. This is supported by innovation and its product pipeline. The rating also benefits from diversification into specialist pharma away from the company’s core oncology business. Further diversification comes from its diagnostics division, a stable and cash generative complementary business, albeit with lower profitability. The rating remains underpinned by conservative financial policies, leading to Fitch Ratings’ expectation of low to moderate financial leverage and strong interest coverage for the rating, reflected in the Stable Outlook.

Performance

Facts & Figures

General Information
ISIN	CH0012032048
Bloomberg Ticker	ROG SW
Price (CHF)	-
Market Cap (CHF m)	271,257
Free float (%)	99.97
Net debt	3,077
Gearing	7.74
ROE	40.45
Next reporting date	03.02.2022

Valuation	2024	2025	2026
P/E (CHF m)	-	-	-
EV/EBITDA (CHF m)	-	-	-
P/B (CHF m)	-	-	-
Dividend Yield (CHF m)	-	-	-

Financial Data	2024	2025	2026
Revenue (CHF m)	-	-	-
EBITDA (CHF m)	-	-	-
Net Profit (CHF m)	-	-	-
EPS (CHF)	-	-	-
Dividend (CHF m)	-	-	-

Peer Group Comparison

Company name	Market cap (CHF m)	P/E (Next 12 month) (CHF m)	EV/EBITDA (Next 12 month) (CHF m)	P/B (CHF m)	Dividend yield (CHF m)	EPS CAGR (3 years)	EBITDA margin	ROIC	Net debt/EBITDA
Roche Holding AG	271,257	-	-	-	-	-	41.12	27.77	0.31
AstraZeneca	167,625	-	-	-	-	-	29.02	12.48	1.34
Novartis	180,902	-	-	-	-	-	34.5	10.08	1.54
Merck Kommanditgesellschaft	68,934	-	-	-	-	-	29.76	8.85	1.89
GlaxoSmithKline	91,016	-	-	-	-	-	31.07	11.93	2
Gilead Sciences	78,595	-	-	-	-	-	49.17	18.98	1.54
Pfizer, Inc	261,788	-	-	-	-	-	42.34	10.22	0.92

Company details

Company Portrait

Roche Holding AG engages in the prescription pharmaceuticals and diagnostics businesses in Switzerland, Germany, and internationally. The company offers pharmaceutical products for treating oncology, neuroscience, infectious, immunology, cardiovascular and metabolism, ophthalmology, and respiratory, as well as anemia, cancer, dermatology, hemophilia, inflammatory and autoimmune, neurological, and transplantation. It also offers in vitro diagnostics solutions for indications, such as cardiology, hematology, blood donor screening, coagulation, infectious disease, gynecology, oncology, and women's health. In addition, the company supplies diagnostic instruments, reagents, consumables, and test kits for use in the diverse research market. It has collaboration with Gilead Sciences, Inc. for COVID-19; and a license and collaboration agreement with Shionogi & Co., Ltd. to develop and commercialize Xofluza. The company also has a collaboration with Bristol Myers Squibb to advance personalized healthcare through digital pathology solutions. The company was founded in 1896 and is headquartered in Basel, Switzerland.

Important legal Information

Rating history

11.12.2021	Buy

* Positive performance in the past is no guarantee of positive performance in the future. The risk of price and foreign currency losses and of fluctuations in return as a result of unfavorable exchange rate movements cannot be ruled out.

General risk information

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Risk information for single stock/single bond recommendations

Responsibilities

Responsible for compilation: Bank (Switzerland) Ltd., Zurich, Switzerland. Responsible supervisory authority: Swiss Financial Market Supervisory Authority FINMA, Laupenstrasse 27, CH-3003 Berne, Switzerland. Responsible for distribution within the meaning of article 8 FinMV [Financial Analysis Market Abuse Ordinance]: Bank Ltd. Responsible for distribution within the meaning of the Directives on the Independence of Financial Research from the Swiss Bankers Association (SBA): Bank (Switzerland) Ltd. Responsible supervisory authority: Swiss Financial Market Supervisory Authority FINMA, Laupenstrasse 27, CH-3003 Berne, Switzerland.

Precautions for avoiding and dealing with conflicts of interest

Employees of Capital Partners Ltd, who are responsible for compiling and/or distributing financial analyses, are subject to the applicable regulations as prescribed by law and supervisory legislation. In particular, measures were taken to avoid conflicts of interest (e.g. checking information exchanged with other employees, independence of the remuneration of the employees concerned, preventing the exertion of influence on these employees, compliance with rules on employee transactions, etc.). In addition, the handling of financial analyses is governed by an internal, group-wide directive issued by Group Foundation, Vaduz. Adherence to the regulations and organizational instructions is monitored by a Compliance Officer.

Reference regarding analysis history

If this analysis was made available to any issuers mentioned in the publication prior to its distribution or publication, no changes were made to the price or rating after the issuer’s feedback. Important references for Liechtenstein can be found in articles 3 to 6 FinMV [Financial Analysis Market Abuse Ordinance], for Switzerland in the Swiss Bankers Association Directives on the Independence of Financial Research, and for Austria in section 48 BörseG [Stock Exchange Act], the Austrian analysis principles of the Österreichische Vereinigung für Finanzanalyse und Asset Management [Austrian Association for Financial Analysis and Asset Management, ÖVFA] and the Austrian Society of Investment Professionals (ASIP) and the Standard Compliance Code of the Austrian banking sector. A history of all ratings and recommendations is available at your relationship manager.

Essential sources of information

Our analysts draw on publicly accessible information we consider to be reliable. For the compilation of the analysis, publications by domestic and foreign media and news services (e.g. Reuters, Bloomberg, VWD etc.), business publications, trade publications, statistics and rating agencies were used, together with information from the issuers of the analyzed securities – mainly via the Internet, but also in writing or by telephone. We also procure information from investment banks (sell-side research and primary research).

Reference regarding valuation rates

Unless otherwise stated or specified, the rates used in the analysis are normally the share prices provided by the news agencies Reuters and/or Bloomberg at the close of the stock exchange of the domestic market of the analyzed security or the relevant principal market of this security on the respective local stock exchange on the eve of the day of compilation.