Is AstraZeneca PLC (AZN) A Risky Investment?

AstraZeneca PLC (NASDAQ:AZN) traded with a subtraction of -$0.37 to $59.52 on Wednesday, a downside of -0.62 percent. An average of 5,676,460 shares of common stock have been traded in the last five days. There was a fall of -$0.19 in the past week. The last 20 days have seen an average of 6,832,305 shares traded, while the 50-day average volume stands at 6,457,024.

AZN stock has increased by 1.80% in the last month. The company shares reached their 1-month lowest point of $55.13 on 09/17/21. With the stock rallying to its 52-week high on 09/24/21, shares of the company touched a low of $46.48 and a high of $61.29 in 52 weeks. In spite of this, the price is down -2.90% from the 52-week high.


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Valuation Metrics

AstraZeneca PLC (AZN) has a trailing price-to-earnings (P/E) ratio of 41.79, which compares with the 23.00 for the broader industry and 31.58 for the sector. This means investors are optimistic about the stock’s future prospects. In the last five years, AstraZeneca PLC’s PE ratio has ranged between 99.67 and 18.94. The stock’s beta is 0.51. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 6.33, the price-to-book (PB) ratio at 10.03, and the price-to-cash flow ratio at 109.69.

Financial Health

The quick ratio of AstraZeneca PLC for the three months ended June 29 was 1.00, and the current ratio was 1.20, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 1.57 and a total debt to equity ratio of 1.75 for the quarter ending June 29. On the profitability front, the trailing 12-month gross margin is 76.20% against a 5-year average of 80.1%. AstraZeneca PLC’s EBITDA margin for the year ending June 29 is 27.47%, while its operating margin for the same period stands at 19.20%. Its gross profit as reported stood at $21.32 billion compared to revenue of $26.62 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, AstraZeneca PLC’s return on assets was 5.60%, compared to 4.2% over the last five years. In the past year, the return on investment has been 12.20%, and the 5-year average is 11.3%. Meanwhile, the return on equity (ROE) for the past 12 months has been 26.00% and the 5-year average holds at 17.9%. For the broader industry, ROE averaged -15.50 over the past year.

Earnings Surprise

The analyst consensus anticipated AstraZeneca PLC’s latest quarter earnings to come in at $0.43 per share, but it turned out to be $0.45, a 4.70% surprise. For the quarter, EBITDA amounted to $1.88 billion.

Technical Picture

From a technical analysis perspective, let’s take a brief look at AstraZeneca PLC (AZN) price momentum. RSI 9-day as of the close on 05 October was 53.72%, suggesting the stock is Neutral, with historical volatility in this time frame at 28.85%.

As of today, AZN’s price is $59.93 -0.32% or -$0.19 from its 5-day moving average. AZN is currently trading +4.22% higher than its 20-day SMA and +7.73% higher than its 100-day SMA. However, the stock’s current price level is +3.52% above the SMA50 and +18.46% above the SMA200.

The stochastic %K and %D were 78.53% and 79.55%, respectively, and the average true range (ATR) was 1.14. With the 14-day stochastic at 70.58% and the average true range at 1.11, the RSI (14) stands at 53.99%. The stock has reached 0.41 on the 9-day MACD Oscillator while the 14-day reading was at 0.87.

Analyst Ratings

The consensus rating for AstraZeneca PLC (AZN) among analysts is Buy. According to current brokerage recommendations, 1 brokerage firm advise that investors sell AZN, while 2 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 2 analysts, while 22 others rate it as a “buy”.

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

Analysts predict a range of price targets between $47.99 and $103.70, with a median target of $68.85. Taking a look at these predictions, the average price target given by analysts for AstraZeneca PLC (AZN) stock is $69.51.

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