Lonza Group AG shares are trading close to a major technical resistance, which, if broken, could yield new upside potential and an increase in volatility. This scenario can be anticipated.
Summary
● The company has strong fundamentals. More than 70% of listed companies have a lower mix of growth, profitability, debt and visibility criteria.
Strengths
● The company returns high margins, thereby supporting business profitability.
● Considering the small differences between the analysts' various estimates, the group's business visibility is good.
● The tendency within the weekly time frame is positive above the technical support level at 421.4 CHF
Weaknesses
● The stock is close to a major daily resistance at CHF 582.4, which should be gotten rid of so as to gain new appreciation potential.
● Based on current prices, the company has particularly high valuation levels.
● With an expected P/E ratio at 48.57 and 41.72 respectively for both the current and next fiscal years, the company operates with high earnings multiples.
● The company is not the most generous with respect to shareholders' compensation.
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Lonza Group AG is one of the world leaders of the development, production and marketing of chemical products. Net sales break down by family of products and services as follows:
- bio-pharmaceuticals (55.4%): exclusive syntheses, microbiological fermentation products , mammalian cell cultures, etc.;
- capsules and dosing solutions for biopharmaceuticals, drugs and nutrition products (17.3%). In addition, the group offers nutritional ingredients;
- small molecule drug substances (13.4%);
- technologies and platforms for manufacturing processes and production of cell and gene therapies (10.4%);
- other (3.5%).
Net sales are distributed geographically as follows: Switzerland (17.4%), Europe (31.7%), the United States (31.8%), the Americas (3.2%), Japan (8.1%), Asia (7.5%) and other (0.3%).