The average target price of BION.SW is 51 and suggests 72% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to increase one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 60.0. This translates into 103% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 47.7. This suggests 61% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

BB Biotech AG is an equity fund launched and managed by Bellevue Asset Management AG. The fund invests in the public equity markets across the globe. It primarily invests in stocks of companies that are engaged in medications and diagnostics based on modern biotechnology. The fund employs a fundamental analysis to create its portfolio. BB Biotech AG was formed on November 09, 1993 and is domiciled in Switzerland.

Switzerland

BB Biotech AG

Healthcare

The company has a track record of regular dividend payments. It has paid dividends in each of the past ten years. Dividend per share (DPS) has grown yearly, but the dynamics are unclear. In the past 12 months, the dividend yield has been outstanding and can be rated excellent compared to its peers. At the same time, the average five-year yield has been significantly higher and exceeded nearly all its peers. On average, the company pays dividends annually. 

BION.SW reported revenue of CHF  At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. Market expects EPS to reach CHF 3.84 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 11ppts and its growth accelerated by 5ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -155.9% in the last 12 months, a decline from 29.6% in FY23. 

Historically, BION.SW has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 75.6%, down from 110.9% in FY23. 

In the last 12 months, the return on capital employed (RoCE) grew to 3.3%, below the peers. The consensus estimate for FY24 for RoCE is 15.4%, however, this time ahead of the peers. 

BB Biotech AG reported a return on equity (RoE) of 3.3% in the last 12 months, up from -8.3% in FY23. The market consensus projects an RoE of 35.4% in FY24, this time above its peers. 

Another important profitability metric, return on assets (RoA), amounted to 3.2% in the last 12 months, an increase from -7.6% in FY23. The market analysts predict that RoA will be 33.6% in FY24, more robust than its peers in this period. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -0.6 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

BION.SW boasts high trading liquidity. The average private investor can sell his common position in the stock almost immediately. Liquidity is usually very stable and is average on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, slow historical revenue growth, bleak profitability, negligible return on capital, poor working capital management, weak debt servicing capacity, and inadequate interest coverage. We note low margin volatility, solid cash flow generation, and an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, BION.SW is not overly volatile. In other words, the stock will fall less than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be low. 

In normal market circumstances, BION.SW is not overly volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will remain relatively stable. The stock's losses on its worst days (less than 1-5% of the time) will range from very low to negligible. 

Based on key historical and expected multiples, the stock is slightly undervalued relative to its peers. In particular, the stock is underpriced on P/E, 'cheap' on EV/EBITDA, trading at neutral levels on P/FCF. 

BB Biotech AG

CHF 29.15

5

BB Biotech AG

CHF 29.15

5

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

CHF 29.15

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