Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
Allergan Inc., current price multiples
| Allergan Inc. | AbbVie Inc. | Amgen Inc. | Bristol-Myers Squibb Co. | Danaher Corp. | Eli Lilly & Co. | Gilead Sciences Inc. | Johnson & Johnson | Merck & Co. Inc. | Pfizer Inc. | Regeneron Pharmaceuticals Inc. | Thermo Fisher Scientific Inc. | Vertex Pharmaceuticals Inc. | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||
| Current share price (P) | $231.12 | |||||||||||||
| No. shares of common stock outstanding | 300,237,694 | |||||||||||||
| Growth rate (g) | -279.49% | |||||||||||||
| Earnings per share (EPS) | $5.08 | |||||||||||||
| Next year expected EPS | $-9.11 | |||||||||||||
| Operating profit per share | $6.69 | |||||||||||||
| Sales per share | $23.73 | |||||||||||||
| Book value per share (BVPS) | $25.82 | |||||||||||||
| Valuation Ratios (Price Multiples) | ||||||||||||||
| Price to earnings (P/E) | 45.53 | 76.51 | 38.04 | — | 36.05 | 68.26 | 281.18 | 25.62 | 11.60 | 16.97 | 12.47 | 23.71 | — | |
| Price to operating profit (P/OP) | 34.53 | 35.82 | 21.43 | — | 28.90 | 56.04 | 81.21 | 17.32 | 9.97 | 10.98 | 13.79 | 20.47 | — | |
| Price to sales (P/S) | 9.74 | 5.81 | 4.86 | 1.97 | 5.89 | 16.05 | 4.72 | 4.06 | 3.09 | 2.14 | 3.87 | 3.50 | 10.27 | |
| Price to book value (P/BV) | 8.95 | 98.44 | 26.47 | 5.84 | 2.84 | 50.93 | 6.98 | 5.04 | 4.29 | 1.55 | 1.87 | 3.03 | 6.90 | |
Based on: 10-K (reporting date: 2014-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Allergan Inc., historical price multiples
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
- Price to Earnings (P/E) Ratio
- The Price to Earnings ratio exhibited a highly unusual value in 2010, reaching 37,139.77, which likely indicates an anomaly or exceptional circumstance during that year. Following 2010, the P/E ratio stabilized substantially, fluctuating within a more typical range from 28.94 in 2011 to 45.53 in 2014. The trajectory from 2011 onward shows a gradual increase, suggesting growing investor expectations of future earnings or a rise in the stock price relative to earnings over time.
- Price to Operating Profit (P/OP) Ratio
- This ratio experienced a notable decrease from 86.17 in 2010 to approximately 19.8 in 2011 and 2012, indicating a sharp reduction in stock price relative to operating profit or a significant improvement in operating profit itself. Between 2011 and 2013, the ratio remained relatively stable around 20.7, followed by a strong increase to 34.53 in 2014. The increase in 2014 may reflect a rise in the stock price or a reduction in operating profit, pointing to changing market perceptions or operating performance.
- Price to Sales (P/S) Ratio
- The Price to Sales ratio shows a consistent upward trend over the observed period. Starting at 4.62 in 2010, the ratio increased steadily each year, reaching 9.74 in 2014. This progressive increase indicates that investors were willing to pay progressively more for each unit of sales, suggesting optimism about the company’s future sales growth or improved profitability margins.
- Price to Book Value (P/BV) Ratio
- The Price to Book Value ratio also demonstrated a rising trend over the period. From 4.68 in 2010, it increased moderately through 2013, reaching 5.80, and then surged to 8.95 in 2014. This pattern reflects an increasing market valuation relative to the company's net asset value, potentially signaling improved investor confidence or market expectations of enhanced asset utilization and profitability.
Price to Earnings (P/E)
Allergan Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 300,237,694 | 298,467,649 | 298,083,478 | 304,442,771 | 305,677,123 | |
| Selected Financial Data (US$) | ||||||
| Net earnings attributable to Allergan, Inc. (in thousands) | 1,524,200) | 985,100) | 1,098,800) | 934,500) | 600) | |
| Earnings per share (EPS)2 | 5.08 | 3.30 | 3.69 | 3.07 | 0.00 | |
| Share price1, 3 | 231.12 | 125.54 | 107.05 | 88.82 | 72.90 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 45.53 | 38.04 | 29.04 | 28.94 | 37,139.77 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
EPS = Net earnings attributable to Allergan, Inc. ÷ No. shares of common stock outstanding
= 1,524,200,000 ÷ 300,237,694 = 5.08
3 Closing price as at the filing date of Allergan Inc. Annual Report.
4 2014 Calculation
P/E ratio = Share price ÷ EPS
= 231.12 ÷ 5.08 = 45.53
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited a consistent upward trend over the five-year period. Starting at $72.90 at the end of 2010, it increased annually to reach $231.12 by the end of 2014. This represents a more than threefold increase, indicating strong market confidence and appreciation in the company's stock value.
- Earnings Per Share (EPS)
- The EPS showed significant improvement from zero in 2010 to positive values in subsequent years. Beginning at $0 in 2010, EPS increased to $3.07 in 2011 and continued to rise to $3.69 in 2012. There was a slight decline in 2013 to $3.30, followed by a substantial increase to $5.08 in 2014. Overall, this reflects growing profitability with some volatility in 2013.
- Price to Earnings Ratio (P/E)
- The P/E ratio started at an unusually high level of 37,139.77 in 2010, likely due to the zero EPS causing a distorted ratio. From 2011 onwards, the P/E ratio stabilized to more typical levels, fluctuating between approximately 29 and 45. Specifically, it was 28.94 in 2011, remained around 29 in 2012, rose to 38.04 in 2013, and increased further to 45.53 in 2014. The upward trend in the P/E ratio from 2012 to 2014 suggests growing investor expectations regarding future earnings potentially outpacing the immediate earnings growth.
Price to Operating Profit (P/OP)
Allergan Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 300,237,694 | 298,467,649 | 298,083,478 | 304,442,771 | 305,677,123 | |
| Selected Financial Data (US$) | ||||||
| Operating income (in thousands) | 2,009,300) | 1,809,300) | 1,613,300) | 1,365,100) | 258,600) | |
| Operating profit per share2 | 6.69 | 6.06 | 5.41 | 4.48 | 0.85 | |
| Share price1, 3 | 231.12 | 125.54 | 107.05 | 88.82 | 72.90 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 34.53 | 20.71 | 19.78 | 19.81 | 86.17 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 2,009,300,000 ÷ 300,237,694 = 6.69
3 Closing price as at the filing date of Allergan Inc. Annual Report.
4 2014 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 231.12 ÷ 6.69 = 34.53
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited a consistent upward trend over the five-year period. It increased significantly from $72.9 at the end of 2010 to $231.12 by the end of 2014. This represents a more than threefold rise, indicating strong market confidence and positive investor sentiment toward the company.
- Operating Profit Per Share
- Operating profit per share showed marked improvement throughout the period. Starting at $0.85 in 2010, it rose steadily each year, reaching $6.69 by the end of 2014. This demonstrates effective operational performance and higher profitability on a per-share basis.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio experienced a steep decline from an exceptionally high level of 86.17 in 2010 to around 20 in the years 2011 to 2013, suggesting that the market initially priced the stock very high relative to its operating profit but then adjusted to a more reasonable valuation. However, in 2014, the P/OP ratio increased again to 34.53. This rise indicates that although operating profits continued to grow, the share price increased at a faster pace, possibly reflecting heightened investor expectations or optimism about future growth beyond operating profit figures.
Price to Sales (P/S)
Allergan Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 300,237,694 | 298,467,649 | 298,083,478 | 304,442,771 | 305,677,123 | |
| Selected Financial Data (US$) | ||||||
| Product net sales (in thousands) | 7,126,100) | 6,197,500) | 5,708,800) | 5,347,100) | 4,819,600) | |
| Sales per share2 | 23.73 | 20.76 | 19.15 | 17.56 | 15.77 | |
| Share price1, 3 | 231.12 | 125.54 | 107.05 | 88.82 | 72.90 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 9.74 | 6.05 | 5.59 | 5.06 | 4.62 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
Sales per share = Product net sales ÷ No. shares of common stock outstanding
= 7,126,100,000 ÷ 300,237,694 = 23.73
3 Closing price as at the filing date of Allergan Inc. Annual Report.
4 2014 Calculation
P/S ratio = Share price ÷ Sales per share
= 231.12 ÷ 23.73 = 9.74
5 Click competitor name to see calculations.
The data indicates a consistent upward trend across all examined financial metrics over the five-year period ending December 31, 2014.
- Share Price
- The share price demonstrated substantial growth, rising from $72.9 at the end of 2010 to $231.12 by the end of 2014. This represents a more than threefold increase over the period, indicating strong market confidence and potentially reflecting positive company performance or favorable market conditions.
- Sales per Share
- Sales per share showed steady growth, increasing from $15.77 in 2010 to $23.73 in 2014. This consistent increase suggests that the company's revenue generation on a per-share basis improved year over year, reflecting operational growth or improved sales effectiveness.
- Price-to-Sales Ratio (P/S)
- The price-to-sales ratio also trended upwards, moving from 4.62 in 2010 to 9.74 in 2014. This near doubling of the P/S ratio indicates that the market valuation relative to sales per share increased significantly, which may imply heightened investor expectations for future growth or improved profitability beyond sales growth alone.
Price to Book Value (P/BV)
Allergan Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 300,237,694 | 298,467,649 | 298,083,478 | 304,442,771 | 305,677,123 | |
| Selected Financial Data (US$) | ||||||
| Total Allergan, Inc. stockholders’ equity (in thousands) | 7,753,000) | 6,463,200) | 5,837,100) | 5,309,600) | 4,757,700) | |
| Book value per share (BVPS)2 | 25.82 | 21.65 | 19.58 | 17.44 | 15.56 | |
| Share price1, 3 | 231.12 | 125.54 | 107.05 | 88.82 | 72.90 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 8.95 | 5.80 | 5.47 | 5.09 | 4.68 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
| Vertex Pharmaceuticals Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
BVPS = Total Allergan, Inc. stockholders’ equity ÷ No. shares of common stock outstanding
= 7,753,000,000 ÷ 300,237,694 = 25.82
3 Closing price as at the filing date of Allergan Inc. Annual Report.
4 2014 Calculation
P/BV ratio = Share price ÷ BVPS
= 231.12 ÷ 25.82 = 8.95
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited a consistent positive trajectory over the five-year period. Starting at $72.90 at the end of 2010, it rose steadily each year, reaching $231.12 by the end of 2014. This represents a significant increase of over 216%, indicating strong market performance and investor confidence during this timeframe.
- Book Value Per Share (BVPS) Trend
- Book value per share also showed a stable upward trend, increasing from $15.56 in 2010 to $25.82 in 2014. This gradual rise suggests the company improved its net asset base on a per-share basis, reflecting internal growth and value accumulation over the period.
- Price-to-Book Value Ratio (P/BV) Analysis
- The price-to-book value ratio increased from 4.68 in 2010 to 8.95 in 2014. This upward movement indicates that the market valuation grew at a rate faster than the underlying book value. The rising P/B ratio suggests investors were willing to pay a higher premium relative to the company's net asset value, possibly due to expectations of future growth, strong profitability, or other intangible factors not captured on the balance sheet.
- Overall Insights
- The data portrays a company with robust market appreciation and steady asset growth. While the consistent increase in share price and BVPS points to solid operational and financial health, the substantial rise in the P/B ratio signals heightened market expectations and increased investor optimism over time.