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Is this Large Market Cap Stock target price reasonable for GlaxoSmithKline plc (NYSE:GSK)?

The company in question is, GlaxoSmithKline plc (NYSE:GSK) currently with a stock price of 43.86 (0.60% today). The market cap for GlaxoSmithKline plc is 103539.97, and is in the sector Healthcare, and Drug Manufacturers – Major industry. The target price for GlaxoSmithKline plc is 47. Currently GlaxoSmithKline plc is trading with a P/E of 130.54, and a forward P/E of 16.68. Average volume for GlaxoSmithKline plc is 3460.25 and so far today it is 1043897.

Performance in the last year for GlaxoSmithKline plc has been 10.75%. For EPS growth, GlaxoSmithKline plc has seen a growth of 204.10%, and is looking to grow in the next year to 14.35%. More long term stats show that EPS growth has been 40.20% over the last five years and could be 0.60% for the next five years. GlaxoSmithKline plc has seen sales growth quarter over quarter at 10.80%, with EPS growth quarter over quarter at -96.60%. The 20-day simple moving average is 3.43%, with the 200-day simple moving average coming to 9.31%.

Since the IPO date for GlaxoSmithKline plc on the 7/9/1986, GlaxoSmithKline plc has seen performance year to date to be 12.96%. With GlaxoSmithKline plc trading at 43.86, the dividend yield is 5.09%, and the EPS is 0.33.

So could GlaxoSmithKline plc, be undervalued? Well as said before P/E is 130.54. The PEG is 217.56, P/S is 3.16 and the P/B is at 28.13. The P/cash is 17.3, with P/free cash flow at *TBA.

GlaxoSmithKline plc ability to deal with debt shows that the current ratio is 1.1, and the quick ratio is 0.8. This is with long term debt/equity at 5.61, and total debt/equity at 6.05.

In terms of margins, GlaxoSmithKline plc has a gross margin of 66.40%, an operating margin of 7.50% and a profit margin of 2.50%.Payout ratio for GlaxoSmithKline plc is 629.40%. Return on assets come to 1.10% with return on investment coming to 41.40%.

Insider ownership for GlaxoSmithKline plc, is at 0.20% and institutional ownership comes to 8.60%. Outstanding shares are at 2374.77. While shares float is 2374.77. The float short is currently 0.26%, and short ratio is 1.8.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Peter Clarke

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