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Comparing Analysts’ Views on Sanofi and GlaxoSmithKline

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Valuation comparison

Sanofi’s (SNY) EV (enterprise value) is $107.7 billion, and its EV-to-revenue ratio is 2.4. The stock is trading at a forward PE (price-to-earnings) ratio of 11.2, and its price-to-earnings-to-growth ratio is 2.2. Sanofi’s price-to-sales ratio is 2.3, and its price-to-book ratio is 1.4. The company’s operating margin is 20.4%. Sanofi has generated an ROA (return on assets) of 4.5% and an ROE (return on equity) of 6.8%.

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In comparison, GlaxoSmithKline’s (GSK) EV is $117.9 billion, and its EV-to-revenue ratio is 2.8. The stock is currently trading at a forward PE ratio of 13.4, and its PEG ratio is 1.6. GlaxoSmithKline’s price-to-sales ratio is 2.3, and its EBITDA (earnings before interest, tax, depreciation, and amortization) ratio is 9.8. GlaxoSmithKline’s operating margin is wider than Sanofi’s, at 22.6%. It has an ROA of 7.4% and an ROE of 51.3%. Sanofi’s current ratio is 1.7, while GlaxoSmithKline’s is 0.60, suggesting Sanofi is better positioned to meet short-term obligations.

Analysts’ recommendations

Of the five analysts covering Sanofi in April, two recommended “strong buy,” and three recommended “hold.” The mean rating for the stock is 2.2, and its target price of $47.67 implies a 19% upside potential based on its current price of $40.11.

In comparison, of the five analysts covering GlaxoSmithKline, one recommended “strong buy,” and four recommended “hold.” The mean rating for GlaxoSmithKline is 2.6, and its target price of $40.88 implies an upside potential of 4.5%.

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