📊 WST Key Takeaways
Is West Pharmaceutical Services Inc. (WST) a Good Investment?
West Pharmaceutical demonstrates solid financial stability with a fortress balance sheet, minimal debt (D/E: 0.07x), and healthy operating margins (21%), but is hampered by concerning profitability stagnation where net income growth of 0.2% significantly lags revenue growth of 6.3%. Critical weaknesses in capital efficiency (ROE: 4.6%, ROA: 3.4%) and a substantial gap between net income ($138.8M) and operating cash flow ($89.9M) suggest underlying operational challenges or working capital deterioration that warrant monitoring.
West Pharmaceutical Services shows high-quality fundamentals with strong margins, robust free cash flow generation, and an exceptionally conservative balance sheet. Revenue growth remains solid, and liquidity is ample, but the near-flat net income growth versus higher sales suggests some cost pressure or mix headwinds that merit monitoring. Overall, the business appears financially strong with good growth quality, though not without execution risk.
Why Buy West Pharmaceutical Services Inc. Stock? WST Key Strengths
- Fortress balance sheet with minimal leverage (D/E 0.07x) and $521.4M cash position providing strategic flexibility
- Strong liquidity ratios (2.71x current, 2.04x quick) and excellent interest coverage (11.7x) indicate zero financial distress risk
- Healthy absolute margins: 35.1% gross margin and 21.0% operating margin demonstrate pricing power in medical devices sector
- Healthy profitability profile with 35.9% gross margin, 19.0% operating margin, and 16.1% net margin
- Excellent financial health driven by 3.02x current ratio, 0.06x debt-to-equity, and 38.7x interest coverage
- Strong cash generation with $754.8M operating cash flow and $468.9M free cash flow, supporting reinvestment flexibility
WST Stock Risks: West Pharmaceutical Services Inc. Investment Risks
- Profitability growth has stalled (net income +0.2%, EPS +1.5%) despite 6.3% revenue growth, indicating margin compression or operational deleverage
- Exceptionally low returns on capital (ROE 4.6%, ROA 3.4%) signal severe capital inefficiency and question long-term value creation
- Operating cash flow of $89.9M significantly lags net income of $138.8M, revealing working capital drag or earnings quality concerns
- Net income growth of just 0.2% trailing revenue growth of 6.3% may indicate margin compression or higher operating costs
- Capital expenditure is meaningful at $285.9M, so returns on ongoing investment need to remain strong
- Growth quality could weaken if future revenue gains rely on less profitable product mix or if operating leverage softens
Key Metrics to Watch
- Earnings growth trajectory relative to revenue growth to confirm margin recovery
- Return on equity and asset returns trends indicating capital deployment effectiveness
- Operating cash flow to net income conversion ratio for cash quality assessment
- Operating margin and net margin trend
- Free cash flow conversion relative to net income
West Pharmaceutical Services Inc. (WST) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.71x current ratio provides a solid financial cushion.
WST Profit Margin, ROE & Profitability Analysis
WST vs Healthcare Sector: How West Pharmaceutical Services Inc. Compares
How West Pharmaceutical Services Inc. compares to Healthcare sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is West Pharmaceutical Services Inc. Stock Overvalued? WST Valuation Analysis 2026
Based on fundamental analysis, West Pharmaceutical Services Inc. has mixed fundamental signals relative to the Healthcare sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
West Pharmaceutical Services Inc. Balance Sheet: WST Debt, Cash & Liquidity
WST Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: West Pharmaceutical Services Inc.'s revenue has shown modest growth of 9% over the 5-year period. The most recent EPS of $7.88 reflects profitable operations.
WST Revenue Growth, EPS Growth & YoY Performance
WST Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $698.0M | $89.8M | $1.23 |
| Q3 2025 | $746.9M | $89.8M | $1.85 |
| Q2 2025 | $702.1M | $89.8M | $1.51 |
| Q1 2025 | $695.4M | $89.8M | $1.23 |
| Q3 2024 | $746.9M | $111.3M | $1.85 |
| Q2 2024 | $702.1M | $111.3M | $1.51 |
| Q1 2024 | $695.4M | $115.3M | $1.55 |
| Q3 2023 | $686.9M | $120.6M | $1.59 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
West Pharmaceutical Services Inc. Dividends, Buybacks & Capital Allocation
WST SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for West Pharmaceutical Services Inc. (CIK: 0000105770)
📋 Recent SEC Filings
❓ Frequently Asked Questions about WST
What is the AI rating for WST?
West Pharmaceutical Services Inc. (WST) has a Combined AI Rating of BUY from Claude (HOLD) and ChatGPT (BUY) with 74% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are WST's key strengths?
Claude: Fortress balance sheet with minimal leverage (D/E 0.07x) and $521.4M cash position providing strategic flexibility. Strong liquidity ratios (2.71x current, 2.04x quick) and excellent interest coverage (11.7x) indicate zero financial distress risk. ChatGPT: Healthy profitability profile with 35.9% gross margin, 19.0% operating margin, and 16.1% net margin. Excellent financial health driven by 3.02x current ratio, 0.06x debt-to-equity, and 38.7x interest coverage.
What are the risks of investing in WST?
Claude: Profitability growth has stalled (net income +0.2%, EPS +1.5%) despite 6.3% revenue growth, indicating margin compression or operational deleverage. Exceptionally low returns on capital (ROE 4.6%, ROA 3.4%) signal severe capital inefficiency and question long-term value creation. ChatGPT: Net income growth of just 0.2% trailing revenue growth of 6.3% may indicate margin compression or higher operating costs. Capital expenditure is meaningful at $285.9M, so returns on ongoing investment need to remain strong.
What is WST's revenue and growth?
West Pharmaceutical Services Inc. reported revenue of $844.9M.
Does WST pay dividends?
West Pharmaceutical Services Inc. pays dividends, with $15.8M distributed to shareholders in the trailing twelve months.
Where can I find WST SEC filings?
Official SEC filings for West Pharmaceutical Services Inc. (CIK: 0000105770) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is WST's EPS?
West Pharmaceutical Services Inc. has a diluted EPS of $1.92.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is WST a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, West Pharmaceutical Services Inc. has a BUY rating with 74% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is WST stock overvalued or undervalued?
Valuation metrics for WST: ROE of 4.6% (sector avg: 15%), net margin of 16.4% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy WST stock in 2026?
Our dual AI analysis gives West Pharmaceutical Services Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is WST's free cash flow?
West Pharmaceutical Services Inc.'s operating cash flow is $89.9M, with capital expenditures of $42.7M. FCF margin is 5.6%.
How does WST compare to other Healthcare stocks?
Vs Healthcare sector averages: Net margin 16.4% (avg: 12%), ROE 4.6% (avg: 15%), current ratio 2.71 (avg: 2).