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How Sanofi’s Valuation Compares

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Nov. 20 2020, Updated 4:16 p.m. ET

Sanofi’s valuation

Sanofi (SNY) has recently been working on expanding its product portfolio in areas with potential growth and strong margins. As the Sanofi posted weak Q1 2018 performance, mainly triggered by weakness in its diabetes and cardiovascular business, the company has recently entered into a number of collaborations and initiatives to recuperate its business. Let’s look at Sanofi’s valuation metrics as of June 27.

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Forward PE multiples

Forward PE multiples, among the most widely used metrics for valuation analysis, are calculated by dividing a company’s current stock price by its expected next-12-month EPS. They reflect how much an investor is willing to pay per unit of a company’s expected earnings. As of June 27, Sanofi was trading at a forward PE multiple of ~11.8x, whereas the industry average was 14.7x. Peers Eli Lilly (LLY), Novo Nordisk (NVO), and GlaxoSmithKline (GSK) had forward PE multiples of 15.9x, 18.1x, and 13.7x, respectively.

Forward EV-to-EBITDA multiples

Let’s now look at forward EV-to-EBITDA multiples, which are capital-structure-neutral valuation metrics. Sanofi’s forward EV-to-EBITDA multiple is ~8.7x, lower than the industry average of ~11.1x. Peers Eli Lilly, Novo Nordisk, and GlaxoSmithKline have higher forward EV-to-EBITDA multiples of 12.7x, 10.5x, and 8.8x, respectively. In the next article, we’ll look at Sanofi’s recent stock performance

Be sure to check out all the data we’ve added to our quote pages. Now you can get a valuation snapshot, earnings and revenue estimates, and historical data, as well as dividend information. Take a look!

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