Hikma Pharmaceuticals (HKMPY) AI Stock Analysis

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Hikma Pharmaceuticals

(Other OTC:HKMPY)

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Rating:77Outperform

Price Target:$50.00▲(14.46% Upside)

Action:reiterated

Date:11/07/26

The score is primarily supported by solid profitability, attractive valuation, and positive earnings-call developments. Weakening cash generation, higher leverage, conservative guidance, and near-term execution risks prevent a higher score.

Positive Factors

Improving revenue and profitabilityRising revenue combined with better operating and net margins indicates improving execution and product mix across Hikma’s portfolio. Although profitability remains below earlier peaks, the recent direction supports stronger earnings capacity and provides resources for continued investment in products and manufacturing.

Negative Factors

Weakening cash generationWeak cash conversion means reported earnings are translating less effectively into funds available for debt reduction, reinvestment and shareholder returns. If this persists, Hikma may have less flexibility to fund capacity and pipeline investments internally while maintaining its capital allocation plans.

Hikma Pharmaceuticals (HKMPY) vs. SPDR S&P 500 ETF (SPY)

Market Cap: $4.94B
Dividend Yield: 3.86%
Average Volume (3M): 398
Price to Earnings (P/E): 12.2
Beta (1Y): 0.56
Revenue Growth: 5.61%
EPS Growth: 6.41%
Country: US
Employees: 9,400
Sector: Healthcare
Sector Strength: 51
Industry: Drug Manufacturers - Specialty & Generic

Hikma Pharmaceuticals Business Overview & Revenue Model

Company Description

Hikma Pharmaceuticals PLC is a global pharmaceutical company that specializes in the development, production, commercialization, and distribution of a wide array of generic, branded, and in-licensed medicines. These pharmaceuticals are provided in va...

How the Company Makes Money

Hikma makes money primarily by selling prescription medicines that it manufactures and distributes through three main operating segments: (1) Injectables: revenue is generated from supplying sterile injectable medicines (often used in hospitals) to h...

Hikma Pharmaceuticals Earnings Call Summary

Earnings Call Date:Aug 06, 2026(Q2-2026)|% Change Since:4.90%|Next Earnings Date:Feb 25, 2027

Earnings Call SentimentPositive

The call presented a broadly positive operational and financial picture: H1 delivered improved profitability (EBIT/EBITDA ~+8%, EPS +5%) and management reiterated full-year guidance while detailing clear operational fixes, R&D and capacity investments (injectables stabilization, U.S. manufacturing expansion, and CMO/Rx pipeline progress). Offsetting factors include geopolitical-driven stockpiling that may depress H2 volumes, the divestment of a loss-making 503B compounding business, some pricing pressure in oral Rx, and near-term variability in CMO revenues. On balance the company emphasized progress on key strategic initiatives and a constructive pipeline, but retained caution on phasing and H2 execution risks.

Positive Updates

Profitability Improvement

EBIT and EBITDA increased by almost 8% year-on-year; EPS rose by 5% in the interim results (H1), and reported H1 operating profit was $405m, supporting management's decision to reiterate full-year guidance.

Negative Updates

Geopolitical Uncertainty and Stockpiling Effects

Ongoing conflict and instability in the MENA region created temporary stockpiling that boosted H1 sales but could depress demand in H2 as inventories are drawn down; management emphasized caution for H2 planning.

Company Guidance

Hikma reiterated FY26 guidance of group revenue growth of 2–4% and operating profit of $720–770m (H1 operating profit was $405m), noting H1 was ~55% weighted for sales; H1 results showed EBIT and EBITDA up almost 8% and EPS up c.5% year‑on‑year, R&D spend and other investments are up, and management cited a 10‑year CAGR of c.8% for sales and c.5–6% for profitability. They said the injectables business is stabilised with CMO revenues expected to pick up in H2 and a major Bedford injectable capacity due in 2028, reiterated a target of 20% of Rx revenue from CMO by 2030, and described branded as able to deliver mid‑to‑high single‑digit top‑line growth with mid‑20s margins (Rx margins approaching ~20%). The buyback is almost complete (about $230m deployed, ~11–12m shares) and the 503B compounding unit is classified held‑for‑sale (expected to be sold within 12 months).

Hikma Pharmaceuticals Financial Statement Overview

Summary

Revenue growth, improving profitability, stable returns, and manageable leverage support a solid score. However, operating cash flow and free cash flow declined materially, while debt-to-equity increased.

Income Statement

82Very Positive

Balance Sheet

78Positive

Cash Flow

65Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.41B	3.36B	3.13B	2.88B	2.52B	2.55B
Gross Profit	1.40B	1.44B	1.42B	1.41B	1.24B	1.30B
EBITDA	889.38M	781.82M	727.00M	566.00M	691.00M	743.00M
Net Income	386.34M	402.94M	359.00M	190.00M	188.00M	421.00M
Balance Sheet
Total Assets	5.83B	5.67B	5.13B	4.68B	4.47B	4.37B
Cash, Cash Equivalents and Short-Term Investments	289.00M	354.00M	213.00M	229.00M	292.00M	450.00M
Total Debt	1.96B	1.60B	1.31B	1.19B	1.28B	846.00M
Total Liabilities	3.29B	3.06B	2.81B	2.47B	2.32B	1.91B
Stockholders Equity	2.52B	2.59B	2.31B	2.20B	2.13B	2.45B
Cash Flow
Free Cash Flow	148.88M	162.38M	329.00M	404.00M	305.00M	409.00M
Operating Cash Flow	398.53M	359.84M	564.00M	608.00M	530.00M	638.00M
Investing Cash Flow	-325.62M	-394.92M	-381.00M	-333.00M	-607.00M	-238.00M
Financing Cash Flow	-45.38M	58.14M	-188.00M	-337.00M	-58.00M	-287.00M

Hikma Pharmaceuticals Technical Analysis

Technical Analysis SentimentNeutral

Last Price43.68

Price Trends

50DMA43.50Positive

100DMA42.89Positive

200DMA39.87Positive

Market Momentum

MACD0.24Positive

RSI44.43Neutral

STOCH2.71Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HKMPY, the sentiment is Neutral. The current price of 43.68 is below the 20-day moving average (MA) of 45.10, above the 50-day MA of 43.50, and above the 200-day MA of 39.87, indicating a neutral trend. The MACD of 0.24 indicates Positive momentum. The RSI at 44.43 is Neutral, neither overbought nor oversold. The STOCH value of 2.71 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HKMPY.

Hikma Pharmaceuticals Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

HKMPY against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LNTH	77Outperform	$6.64B	24.48	21.72%	―	2.38%	69.00%
HKMPY	77Outperform	$4.50B	12.20	15.05%	3.86%	5.61%	6.41%
RDY	67Neutral	$12.20B	41.27	7.37%	0.57%	-10.52%	-55.45%
TEVA	65Neutral	$49.49B	102.78	9.18%	―	2.99%	-28.63%
AMRX	58Neutral	$7.56B	50.14	131.71%	―	8.88%	2272.07%
VTRS	58Neutral	$24.14B	-39.42	-4.24%	2.32%	4.80%	82.97%
Sector *	51Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

* Healthcare Sector Average

Performance Comparison

HKMPY and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
HKMPY	Hikma Pharma	43.68	4.08	10.30%
RDY	Dr. Reddy's Laboratories Ltd	14.73	0.87	6.25%
VTRS	Viatris, Inc.	20.67	10.32	99.67%
TEVA	Teva Pharmaceutical Industries Limited	43.65	17.65	67.88%
LNTH	Lantheus Holdings Inc	101.25	48.24	91.00%
AMRX	Amneal Pharma	21.70	10.06	86.43%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Nov 07, 2026

Hikma Pharmaceuticals AI Stock Analysis