Lonza Group (LZAGY) AI Stock Analysis

• Market Cap: $48.14B
• Dividend Yield: 0.47%
• Average Volume (3M): 178.01K
• Price to Earnings (P/E): 66.7
• Beta (1Y): 1.07
• Revenue Growth: -0.20%
• EPS Growth: 4.89%
• Country: US
• Employees: 17,995
• Sector: Healthcare
• Sector Strength: 38
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 0.96
• Shares Outstanding: 722,261,840
• 10 Day Avg. Volume: 42,679
• 30 Day Avg. Volume: 178,013
• PEG Ratio: -7.14
• Price to Book (P/B): 4.48
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.63K
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $74.80
• Price Target Upside: 10.52% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

Lonza Group scores a 66, reflecting strong operational efficiency and a stable balance sheet. However, challenges such as inconsistent revenue growth, negative free cash flow, and high valuation dampen the outlook. Technical analysis suggests mixed momentum, with longer-term support but potential short-term weakness.

Lonza Group Business Overview & Revenue Model

Company Description

Lonza Group (LZAGY) is a leading global provider of integrated healthcare solutions, primarily serving the pharmaceutical, biotechnology, and specialty ingredients markets. With a strong emphasis on research and development, Lonza offers a comprehensive range of products and services, including custom development and manufacturing of active pharmaceutical ingredients (APIs), drug products, and bioscience solutions. The company operates through two main segments: Pharma & Biotech and Specialty Ingredients, delivering value across the entire healthcare continuum.

How the Company Makes Money

Lonza Group generates revenue through a diversified business model focusing on the Pharma & Biotech and Specialty Ingredients segments. In the Pharma & Biotech segment, Lonza offers custom development and manufacturing services, including contract development and manufacturing organization (CDMO) services, which support the development and production of biologics, cell and gene therapies, and small molecule drugs. This segment is a key revenue driver, benefiting from long-term contracts and strategic partnerships with pharmaceutical and biotechnology companies. The Specialty Ingredients segment provides high-quality ingredients and solutions for the nutrition, hygiene, preservation, and personal care industries, contributing to Lonza's revenue through the sale of specialty chemicals and consumer health products. The company's earnings are further supported by its investment in innovation, strategic acquisitions, and global operations, which enhance its ability to meet the evolving needs of its clients.

Lonza Group Financial Statement Overview

Summary

Lonza Group's financials show strong profitability and operational efficiency with healthy gross and net profit margins. However, inconsistent revenue growth, declining net income, and negative free cash flow due to high capital expenditures are concerns. The balance sheet is stable with manageable debt, but increasing liabilities could pose future risks.

Income Statement

Lonza Group's income statement reflects stable revenue with a slight decline from the previous year. The gross profit margin and net profit margin are healthy, indicating good profitability. However, the revenue growth rate has been inconsistent, with a recent decrease. The EBIT and EBITDA margins show strong operational efficiency, but the net income has declined from its peak in 2021, suggesting some challenges in maintaining profitability growth.

Balance Sheet

The balance sheet is robust, with a solid equity base and a moderate debt-to-equity ratio, ensuring financial stability. Return on Equity (ROE) is positive but has declined, pointing to decreased efficiency in generating profits from shareholders' equity. The equity ratio is strong, indicating a healthy proportion of assets financed by shareholders' equity. However, the increase in total liabilities over time is a concern that needs monitoring.

Cash Flow

Lonza Group's cash flow situation shows mixed results. Operating cash flow remains strong, although free cash flow is negative, primarily due to significant capital expenditures. The operating cash flow to net income ratio suggests effective cash generation from operations, but the negative free cash flow to net income ratio highlights challenges in covering capital expenditures from operating activities.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
6.70B	6.57B	6.72B	6.22B	5.41B	4.51B
	Gross Profit
1.96B	2.16B	1.95B	2.30B	1.97B	1.71B
	EBIT
1.24B	964.00M	880.00M	1.35B	819.00M	937.00M
	EBITDA
1.84B	1.54B	1.53B	2.12B	1.38B	1.39B
	Net Income Common Stockholders
573.00M	636.00M	654.00M	1.22B	2.94B	869.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
286.00M	1.71B	1.67B	2.22B	3.18B	495.00M
	Total Assets
6.83B	19.73B	16.85B	17.56B	16.69B	14.63B
	Total Debt
1.86B	5.12B	3.13B	2.59B	2.75B	3.81B
	Net Debt
1.59B	4.01B	1.66B	1.25B	1.17B	3.32B
	Total Liabilities
4.47B	10.35B	7.34B	6.89B	6.87B	7.74B
	Stockholders Equity
2.35B	9.33B	9.45B	10.60B	9.75B	6.82B
Cash Flow		Free Cash Flow
26.00M	-143.00M	-263.00M	-833.00M	-126.00M	163.00M
	Operating Cash Flow
1.54B	1.27B	1.39B	1.04B	1.22B	1.14B
	Investing Cash Flow
-1.73B	-2.92B	-1.10B	-991.00M	1.02B	-1.09B
	Financing Cash Flow
-109.00M	1.28B	-152.00M	-286.00M	-1.28B	93.00M

Lonza Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 67.68
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LZAGY, the sentiment is Positive. The current price of 67.68 is below the 20-day moving average (MA) of 69.33, above the 50-day MA of 65.24, and above the 200-day MA of 63.17, indicating a neutral trend. The MACD of 0.86 indicates Positive momentum. The RSI at 52.13 is Neutral, neither overbought nor oversold. The STOCH value of 5.30 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LZAGY.

Lonza Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
A	79 Outperform	$31.79B	25.63	20.61%	0.86%	-3.00%	3.67%
IQV	76 Outperform	$24.53B	19.14	21.65%	―	2.84%	-0.16%
TMO	69 Neutral	$153.28B	23.83	13.73%	0.39%	0.96%	9.19%
LZAGY	66 Neutral	$48.14B	66.70	6.71%	0.47%	-0.20%	4.89%
DHR	64 Neutral	$140.35B	37.02	7.22%	0.59%	-9.19%	-12.75%
ICLR	64 Neutral	$10.63B	14.32	8.01%	―	-0.48%	11.47%
Sector *	52 Neutral	$5.15B	3.05	-44.13%	2.84%	16.42%	-0.48%