Looking To Buy Emergent BioSolutions Inc. (EBS)? Read This First

Emergent BioSolutions Inc. (NYSE:EBS) saw an upside of 9.87% to close Friday at $55.01 after adding $4.94 on the day. The 5-day average trading volume is 485,980 shares of the company’s common stock. It has gained $55.35 in the past week and touched a new high 2 times within the past 5 days. An average of 445,450 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 407,050.

EBS’s 1-month performance is -13.59% or -$8.65 on its low of $49.35 reached on 10/01/21. The company’s shares have touched a 52-week low of $50.02 and high of $127.20, with the stock’s rally to the 52-week high happening on 02/16/21. YTD, EBS has lost -38.60% or -$34.59 and has reached a new high 14 times. However, the current price is down -56.75%% from the 52-week high price.


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Insider Transactions

On May 25, 130 days have gone by since the last insider trading activity for Emergent BioSolutions Inc. (EBS). Zoon Kathryn C (Director) most recently sold 3,139 shares at $56.48 per share on May 25. This transaction cost the insider $177,291. Director, Bailey Sue, sold 8,168 shares at a price of $92.37 on Mar 04. Then, on Mar 01, EVP, Business Operations Havey Adam sold 37,279 shares at a price of $99.30 per share. This transaction amounted to $3,701,647.

Valuation Metrics

The company’s PE ratio for the last five years has touched a high of 843.71 and a low of 7.884. EBS stock has a beta of 0.97. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 1.78 while the price-to-book (PB) in the most recent quarter is 1.91, with the price to cash flow ratio at 25.11.

Emergent BioSolutions Inc.’s quick ratio for the period ended June 29 was 2.10, with the current ratio over the same period at 3.10 meaning that EBS stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending June 29 was 0.53, while the total debt to equity was 0.55. In terms of profitability, the gross margin trailing 12 months is 63.30%The trailing 12-month EBITDA margin is 39.15% while for the period ending June 29; Emergent BioSolutions Inc.’s operating margin was 25.10%. The firm’s gross profit as reported stood at $1.03 billion against revenue of $1.56 billion.

The effectiveness of a company’s management is also important for investors when it comes to determining the potential profitability of the investment. Emergent BioSolutions Inc.’s return on assets over the past 12 months stands at 10.60%. Return on investment over the past year is 14.30%, while its return on equity (ROE) trailing 12 months is 20.80%. In comparison, the average ROE for the broader industry over the past year is 4.13.

Earnings Surprise

For the quarterly period ending June 29 this year, Net income and sales went up compared to those figures reported in the previous quarter. Analysts expected EBS to announce $1.54 per share in earnings in its latest quarter, but it posted $0.33, representing a -78.60% surprise. EBITDA for the quarter stood at more than $48.7 million. EBS stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 1.37 billion, with total debt at $897.0 million. Shareholders hold equity totaling $53.7 million

Technical Picture

Let’s look briefly at Emergent BioSolutions Inc. (EBS) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 01 October was 49.46% to suggest the stock is trending Neutral, with historical volatility in this time period at 60.56%.

The stock’s 5-day moving average is $52.67, reflecting a +5.00% or $2.62 change from its current price. EBS is currently trading -13.25% above its 20-day SMA, -6.45% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by -13.57% and -38.39% respectively.

Stochastic %K and %D was 21.81% and 11.98% and the average true range (ATR) pointed at 2.25. The RSI (14) points at 44.86%, while the 14-day stochastic is at 63.03% with the period’s ATR at 2.13. The stock’s 9-day MACD Oscillator is pointing at -0.83 and -2.25 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Emergent BioSolutions Inc. (NYSE: EBS), Argus downgraded it to a Hold rating. They previously had a Buy rating on the stock. Analysts offering their rating for EBS stock have a consensus rating for the stock as Overweight. Currently, 0 brokerage advisors rate EBS as a “sell,”, while 4 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 0 rates the stock as overweight while 4 have offered a “buy” rating.

What is EBS’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $63.00 and a high of $120.00, with their median price target at $92.00. Looking at these predictions, the average price target given by analysts is for Emergent BioSolutions Inc. (EBS) stock is $85.71.

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