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1. Company Snapshot

1.a. Company Description

Hikma Pharmaceuticals PLC develops, manufactures, markets, and sells a range of generic, branded, and in-licensed pharmaceutical products.The company offers its products in solid, semi-solid, liquid, and injectable final dosage forms.It operates through three segments: Injectables, Generics, and Branded.


The Injectables segment provides generic injectable products primarily for use in hospitals.The Generics segment offers oral and other non-injectable generic products for the retail market.The Branded segment offers branded generics and in-licensed products to retail and hospital markets.


The company provides its products in various therapeutic areas, including anti-infective, cardiovascular, central nervous system, diabetes, oncology, pain management, and respiratory.It operates in the United Kingdom, the United States, the Middle East, North Africa, Europe, and internationally.The company was founded in 1978 and is based in London, the United Kingdom.

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1.b. Last Insights on HIK

Hikma Pharmaceuticals' recent performance faces challenges due to execution concerns, despite analyst optimism on core strengths. The company's institutional owners hold 59% of the company, implying significant influence. A slight increase in the consensus analyst price target to £25.40 from £25.02 reflects reassessment of growth prospects. Meanwhile, Ritedose's FDA approval for generic Tobramycin Inhalation Solution may pose competitive pressure. With no recent earnings release available, investors monitor Hikma's progress amid evolving narratives and shifting expectations.

1.c. Company Highlights

2. Hikma Delivers Mixed First Half, Navigating Headwinds

Hikma Pharmaceuticals reported a solid revenue increase of 6% year-on-year for the first half of 2025, reaching $1.23 billion. However, core operating profit declined by 7% to $373 million, primarily due to regional and product mix headwinds, foreign exchange pressures, and a strong comparator in the prior year. This translates to a core operating margin of 30.4%, down from 36.3% in the same period last year. Core EBITDA and core basic earnings per share also declined by 5% each, signaling a slowdown in profitability.

Publication Date: Aug -13

📋 Highlights
  • Overall Revenue Growth:: Hikma's revenue increased 6% YoY to $X billion in H1 2025, though core operating profit fell 7% to $373 million due to mix headwinds, FX, and a strong 2024 comparator.
  • Injectables Segment Performance:: Revenue rose 12% YoY from Xellia acquisition and new launches, but operating profit declined 7% to $112 million, with margin dropping to 30% from 36.3%.
  • Branded Segment Stability:: Achieved 4% revenue growth and 3% operating profit growth in MENA, maintaining a consistent 30% operating margin.
  • Rx Segment Challenges:: Core operating profit declined due to price erosion and higher R&D investment, despite strong inhalation product sales.
  • Full-Year Guidance:: Reaffirmed 4-6% revenue growth and core operating profit of $730–$770 million for 2025, emphasizing strategic investments in R&D and manufacturing.

Segment Performance

The Injectables segment demonstrated strong revenue growth of 12% year-on-year, fueled by recent launches and the Xellia acquisition. The European and MENA businesses were key drivers of this growth. However, operating profit declined 7% to $112 million, with a margin of 30% compared to 36.3% in the prior year. This suggests that higher input costs and increased competition may be impacting profitability in this segment. The Branded segment maintained a 30% operating margin, delivering 4% revenue growth and 3% operating profit growth in MENA. Meanwhile, the Rx segment experienced solid performance with good growth from inhalation products, but core operating profit declined due to price erosion and increased R&D spend, highlighting the ongoing pressure on margins in this competitive market.

Outlook and Valuation

Hikma reiterates its full-year 2025 guidance of 4% to 6% revenue growth and core operating profit in the range of $730 million to $770 million. This guidance suggests that the company expects to navigate the current headwinds and deliver continued growth, although at a slower pace than in recent years. Looking at valuation, Hikma is currently trading at a P/E ratio of 15.2, a P/B ratio of 2.36, and an EV/EBITDA of 8.34. These multiples suggest that the market is pricing in some uncertainty about the company's future profitability, given the recent decline in operating margins.

3. NewsRoom

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How Recent Developments Are Shaping the Hikma Pharmaceuticals Story and Its Valuation

Nov -28

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Why The Narrative Around Hikma Pharmaceuticals Is Shifting After Recent Analyst Updates

Nov -14

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Health Care Roundup: Market Talk

Nov -06

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Ritedose Now Offers the Largest Nebulized Drug Portfolio in the U.S.: FDA Approves the Company to Manufacture Generic Tobramycin Inhalation Solution

Oct -30

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How Recent Developments Are Rewriting the Story for Hikma Pharmaceuticals

Oct -30

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FTSE 100 hits another high despite concerns over US government shutdown

Oct -01

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Pharma Stocks in Europe Jump After White House Unveils Drug-Buying Site

Oct -01

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Hikma Pharmaceuticals PLC (LON:HIK) is favoured by institutional owners who hold 59% of the company

Sep -19

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.08%)

6. Segments

Injectables

Expected Growth: 5%

Hikma Pharmaceuticals PLC's Injectables segment growth is driven by increasing demand for affordable and accessible healthcare, expansion into emerging markets, and a strong pipeline of generic and branded products. Additionally, strategic partnerships and acquisitions, as well as investments in manufacturing capabilities and quality control, contribute to the segment's growth.

Generics

Expected Growth: 3%

Hikma Pharmaceuticals PLC's generics segment growth is driven by increasing demand for affordable medicines, strategic partnerships, and expansion into emerging markets. Additionally, the company's strong pipeline of products and investments in R&D are expected to contribute to its growth. Furthermore, the rising prevalence of chronic diseases and an aging population are also driving demand for generics.

Branded

Expected Growth: 4%

Hikma Pharmaceuticals PLC's branded segment growth is driven by increasing demand for its specialty products, expansion into new markets, and strategic partnerships. Additionally, the company's focus on R&D and product launches has contributed to its growth. Furthermore, the company's strong presence in the Middle East and North Africa region has also driven growth.

Others

Expected Growth: 2%

Hikma Pharmaceuticals PLC's growth is driven by its strong presence in the MENA region, diversified product portfolio, and strategic acquisitions. The company's focus on generics and injectables, as well as its partnerships with multinational companies, have contributed to its growth. Additionally, Hikma's investment in R&D and its ability to capitalize on industry trends, such as the shift towards value-added medicines, have also supported its growth.

7. Detailed Products

Branded Generics

Hikma's branded generics portfolio includes a range of products that are marketed and sold under their own brand names, often in partnership with pharmaceutical companies.

Injectables

Hikma's injectables portfolio includes a range of products used in hospitals and clinics, including antibiotics, analgesics, and anesthetics.

Generics

Hikma's generics portfolio includes a range of products that are bioequivalent to branded products, but at a lower cost.

APIs (Active Pharmaceutical Ingredients)

Hikma's API portfolio includes a range of active pharmaceutical ingredients used in the manufacture of pharmaceutical products.

R&D Services

Hikma's R&D services include contract research and development services for pharmaceutical companies.

8. Hikma Pharmaceuticals PLC's Porter Forces

Forces Ranking

Threat Of Substitutes

Hikma Pharmaceuticals PLC operates in a highly regulated industry, and the threat of substitutes is moderate due to the presence of alternative treatments and generic drugs.

Bargaining Power Of Customers

The bargaining power of customers is low due to the fragmented nature of the pharmaceutical industry, and the lack of concentration among buyers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate due to the presence of a few large suppliers of raw materials and the dependence of Hikma Pharmaceuticals PLC on these suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the pharmaceutical industry, including regulatory hurdles and the need for significant investment in research and development.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the pharmaceutical industry, and the need for Hikma Pharmaceuticals PLC to compete on price, quality, and innovation.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.14%
Debt Cost 6.16%
Equity Weight 64.86%
Equity Cost 6.16%
WACC 6.16%
Leverage 54.19%

11. Quality Control: Hikma Pharmaceuticals PLC passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Ipsen

A-Score: 5.5/10

Value: 5.0

Growth: 6.0

Quality: 7.7

Yield: 1.2

Momentum: 6.0

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Hikma Pharmaceuticals

A-Score: 5.3/10

Value: 4.9

Growth: 4.4

Quality: 6.1

Yield: 5.0

Momentum: 3.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Almirall

A-Score: 5.0/10

Value: 4.3

Growth: 2.2

Quality: 4.3

Yield: 2.5

Momentum: 9.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Sobi

A-Score: 4.8/10

Value: 3.1

Growth: 7.3

Quality: 7.4

Yield: 0.0

Momentum: 5.0

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
Siegfried Holding

A-Score: 4.4/10

Value: 4.4

Growth: 7.4

Quality: 5.5

Yield: 0.6

Momentum: 1.0

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Alvotech

A-Score: 2.9/10

Value: 5.1

Growth: 5.8

Quality: 5.7

Yield: 0.0

Momentum: 0.0

Volatility: 1.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

15.94$

Current Price

15.94$

Potential

-0.00%

Expected Cash-Flows