One-glance verdict
Overvalued
$169.48 our estimate vs market $362.01
Wall Street consensus: $405.38 (139.2% higher than our fair-value estimate)
114% above our estimate, beyond the bull case
Fundamentals snapshot
West Pharmaceutical Services, Inc.
WST · NYQ · Healthcare · Medical Instruments & Supplies
Current price
$362.01
52-week range
$223.83 - $386.00
Market cap
$25.48B
Balance sheet
Healthy
1,272.20x Strong cushion
Net cash $119.30M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 8.2% last year.
- Reward Returns 19.1% on equity, ahead of 80% of its peers.
- Risk Stock trades 13.5% above its 5-year average P/E.
- Risk Operating margin compressed from 26.4% to 22.5% over 3 years.
What this company does
West Pharmaceutical Services, Inc.
West Pharmaceutical Services makes the essential packaging for injectable drugs, such as the rubber stoppers on vaccine vials or the components for self-injection pens. The company primarily earns money by selling these highly specialized products directly to the world's largest drug makers, who rely on West's quality to keep medicines safe. Because these parts are critical for drug approval and patient safety, pharmaceutical companies rarely switch suppliers, making West a key partner in the healthcare supply chain (the system of organizations and processes that get a product from creation to the customer).
How the company got here
Founded in 1923 by Herman O. West in Philadelphia, the company started by making rubber components for dental and pharmaceutical use. A key moment came during World War II when it partnered with Eli Lilly to create packaging that allowed for the mass distribution of penicillin to soldiers. Over the decades, West expanded from being a simple component supplier to a global manufacturer of sophisticated packaging and delivery systems for injectable medicines. Strategic acquisitions, like The Tech Group in 2005, added contract manufacturing capabilities, broadening its services to the healthcare industry.
What it actually does
Think about any time you or someone you know has received a vaccine or an injectable medication; it's very likely a West product was involved. The company manufactures the mission-critical little pieces that contain and help deliver these medicines, such as the rubber stoppers on vials, the plungers in syringes, and components for self-injection pens used for conditions like diabetes or autoimmune diseases. They don't make the drugs themselves, but they create the specialized packaging and systems that keep the medicine safe, stable, and easy to administer. West works closely with top pharmaceutical and biotech companies to ensure these components are perfect for each specific drug, from the earliest stages of development.
Proprietary Products
This is the company's core and largest business, making up about three-quarters of its sales. This segment designs and sells its own line of high-tech components for injectable drugs, like specialized stoppers, seals, and syringe plungers. These aren't generic parts; they are often custom-developed with advanced coatings and materials to protect sensitive modern drugs called biologics (complex medicines made from living organisms). Pharmaceutical and biotech companies pay for these premium components because they are crucial for ensuring the drug's safety and effectiveness, and once a drug is approved by regulators with a West component, it is very difficult and costly for the drug maker to switch suppliers.
Contract-Manufactured Products
This part of the business acts as a manufacturing partner for other healthcare companies, making up the remaining quarter of its revenue. Instead of selling its own branded products, this segment uses its expertise in complex manufacturing and assembly to build devices to its customers' specifications. This can include anything from diagnostic tools and surgical devices to complex drug delivery systems. Essentially, pharmaceutical and medical device companies hire West to design, manufacture, and assemble these complicated products for them, relying on West's specialized engineering and quality control.
What management is betting on now
The company is heavily focused on its high-value products, especially those used for biologics, which are a fast-growing area of medicine. Management is investing in expanding manufacturing capacity and technology to support the increasing number of injectable drugs coming to market. They are also pursuing strategic partnerships and investments in innovative technologies to enhance their drug delivery solutions, making them safer and more convenient for patients. A key part of their strategy is to work very closely with drug makers early on, embedding their components into the design and regulatory approval process to build long-lasting, sticky customer relationships.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$98.80M
FY2024 Q4
$85.20M
FY2025 Q1
$58.10M
FY2025 Q2
$101.90M
FY2025 Q3
$133.90M
FY2025 Q4
$175.00M
FY2026 Q1
$47.20M
FY2026 Q2
$80.80M
Revenue
$872.30M
Net income
$154.00M
Diluted EPS
2.15
Operating cash flow
$124.00M
Free cash flow
$80.80M
Fetching…
Sources
Revenue
$844.90M
Net income
$138.80M
Diluted EPS
1.92
Operating cash flow
$89.90M
Free cash flow
$47.20M
Fetching…
Sources
Revenue
$805.00M
Net income
$132.10M
Diluted EPS
1.82
Operating cash flow
$251.10M
Free cash flow
$175.00M
Fetching…
Sources
Revenue
$804.60M
Net income
$140.00M
Diluted EPS
1.92
Operating cash flow
$197.20M
Free cash flow
$133.90M
Fetching…
Sources
Revenue
$766.50M
Net income
$131.80M
Diluted EPS
1.82
Operating cash flow
$177.10M
Free cash flow
$101.90M
Fetching…
Sources
Revenue
$698.00M
Net income
$89.80M
Diluted EPS
1.23
Operating cash flow
$129.40M
Free cash flow
$58.10M
Fetching…
Sources
Revenue
$748.80M
Net income
$130.10M
Diluted EPS
1.78
Operating cash flow
$190.10M
Free cash flow
$85.20M
Fetching…
Sources
Revenue
$746.90M
Net income
$136.00M
Diluted EPS
1.85
Operating cash flow
$180.10M
Free cash flow
$98.80M
Fetching…
Sources
Is it cheap or expensive?
Fair value $169.48 vs current price $362.01
Wall Street consensus is the average analyst price target: $405.38 (139.2% higher than our fair-value estimate).
Our most-likely fair value is $169.48 a share — about 53.2% below today's price of $362.01, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $119.3M - more cash than debt. Interest coverage 1272.2x.
Net debt
$-119.30M
Interest coverage
1,272.20x
West Pharmaceutical Services, Inc.'s profit covers its interest bill about 1272.2 times over. which is stronger than every peer shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
WST
BASELINE
West Pharmaceutical Services, Inc.
Total debt $316.50M Interest coverage 1,272.20x This is the baseline the peer rows are being compared against.
Total debt $16.81B Interest coverage 4.87x -100% vs WST Carries about 261.2x less debt cushion than WST.
Total debt $9.67B Interest coverage 0.61x -100% vs WST Carries about 2084.4x less debt cushion than WST.
Total debt $1.41B Interest coverage 9.69x -99% vs WST Carries about 131.3x less debt cushion than WST.
Total debt $9.38B Interest coverage 6.78x -99% vs WST Carries about 187.6x less debt cushion than WST.
What you should know
The case for and against WST
3 Rewards
2 Risks
Rewards
-
Revenue grew 8.2% last year.
-
Returns 19.1% on equity, ahead of 80% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 13.5% above its 5-year average P/E.
-
Operating margin compressed from 26.4% to 22.5% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
46.71x
Forward P/E
36.29x
P/B
8.52x
P/S
7.66x
EV/EBITDA
27.80x
PEG ratio
2.77x
Profitability
How much profit each dollar creates
Gross margin
36.8%
Operating margin
22.5%
Net margin
17.0%
ROE
19.1%
ROA
11.4%
Health
Liquidity and balance-sheet strength
Debt / equity
0.11x
Current ratio
2.82x
Quick ratio
1.82x
Total debt
$316.50M
Total cash
$435.80M
Growth
How the business has been compounding
Revenue TTM
$3.33B
Revenue 5Y CAGR
2.1%
EPS TTM
7.75
EPS 5Y CAGR
-4.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$662.20M
Free CF TTM
$468.90M
FCF margin
14.1%
Dividend
Shareholder payout
Yield
0.2%
Payout ratio
11.1%
Last ex-div date
2026-07-29