# West Pharmaceutical Services (WST) Sector: Injectable drug delivery systems and components | Field | Value | |---|---| | Price | $412.86 | | Market cap | $29B | | Intrinsic value source | Analysts | | Data as of | 2026-11-12 | | Next earnings | 2027-02-11 (estimate) | Analysts: Very bullish Picks: Research only Discount category: Far above intrinsic value ## In short Investors pay a premium for the fast growth of the high-value injectable components of West, and only double-digit sales growth with rising margins in 2027 can earn this price. ## Themes and gap - Themes: Weight-loss drugs (weight-loss-drugs), New management (management-change) - Gap type: Can close (closable) - Why: The Q4 report in February 2027 with the first view of 2027 shows whether sales growth and margins stay high under the new chief executive. ## About West Pharmaceutical Services, Inc. (West) makes containment and delivery products for injectable medicines. It is based in Exton, Pennsylvania. Its Proprietary Products segment makes high-value components such as elastomer stoppers and seals, high-value delivery devices such as the Daikyo Crystal Zenith systems, and standard products. Its West Vantage segment designs, makes and assembles complex devices for pharmaceutical, diagnostic and medical device customers. West sells mostly to pharmaceutical and biotech companies and contract manufacturers. In 2025, net sales were $3.07 billion. It has over 10,000 team members at 50 sites, including 26 factories, and holds 49% of Daikyo Seiko, its partner in Japan. Michel Lagarde became President and Chief Executive Officer on August 31, 2026. West files 10-K and 10-Q reports with the SEC, and its common stock trades on the New York Stock Exchange in US dollars. ## Thesis The price of West depends on whether high-value components can keep growing at a double-digit rate while margins rise. In Q3 of 2026, net sales rose 8.7% to $874.5 million, organic growth was 11.9% and adjusted EPS rose 35.7% to $2.66. High-value components, which are 53% of sales, grew 19.7%, led by demand for biologic and GLP-1 medicines. The company raised its guidance for 2026 to adjusted EPS of $9.38 to $9.48. The market has to weigh this against a cyber attack in May 2026 that stopped operations for some time, a change of chief executive and a weak West Vantage segment, where sales fell 7.3%. A gain of $55.7 million from the sale of the SmartDose 3.5mL system also helped reported results in Q3. For the price to hold or rise, three things must be true. Orders for high-value components must keep growing at a double-digit rate as customers launch more biologic and GLP-1 products. The adjusted operating margin must keep rising from 23.1% in the first nine months of 2026. The new chief executive must keep the plan without more operating problems. The next tests are the Q4 report with the first view of 2027, expected in February 2027, and the Q1 report in April 2027. ## Checkpoints - Feb 11, 2027 (estimate): Q4 2026 results and the first view of 2027. Status: Pending. Watch: High-value components keep growing at a double-digit rate and the adjusted operating margin rises, and this passes; slower growth or a lower margin fails. - Apr 2027 (estimate): Q1 2027 results. Status: Pending. Watch: Organic growth stays above 10% under the new chief executive with no new operating problem, and this passes; a clear slowdown fails. - Jul 2027 (estimate): Q2 2027 results: first-half margin. Status: Pending. Watch: The adjusted operating margin for the first half of 2027 is above the 23.1% of the first nine months of 2026, and this passes; a lower margin fails. ## Balance sheet - Cash: $464M - Debt: $203M - Net cash: $261M - Undrawn credit line: $498M At September 30, 2026, West had cash of $464.1 million, down from $791.3 million at December 31, 2025. Total debt was $202.9 million. It had no borrowings under its revolving credit facility of $500.0 million, of which $497.7 million was available after letters of credit. On October 26, 2026, it replaced its credit facilities with a new agreement that has a revolving facility of $750 million and a term loan of $200 million, due on October 26, 2031. Total equity was $2,968.2 million, down from $3,176.0 million at the end of 2025, because West bought back $685.3 million of stock in the first nine months. Operating cash flow was $403 million and capital spending was $125 million in that period. The company expects capital spending of $215 million to $220 million for 2026. As of 2026-09-30. Sources: - https://www.sec.gov/Archives/edgar/data/105770/000010577026000121/wst-20260930.htm - https://www.sec.gov/Archives/edgar/data/105770/000010577026000118/exh991q32026earningsrelease.htm ## Dividends - Dividend yield: 0.2% (last 12 months, at the current price) - Paid per share, last 12 months: $0.92 (4 payments) - Current annual rate: $1.04 ($0.26 x 4 a year) - Payout ratio: 13% of the earnings of the last fiscal year (the year ended 2025-12-31) - Latest ex-dividend date: 2026-11-10, $0.26 per share - Growth from 2020 to 2025: 5.5% a year - Growth from 2015 to 2025: 6.6% a year Dividends per share by year: 2016: $0.49, 2017: $0.53, 2018: $0.57, 2019: $0.61, 2020: $0.65, 2021: $0.69, 2022: $0.73, 2023: $0.77, 2024: $0.81, 2025: $0.85. Source: company filings and market data, read on 2026-11-13. ## Recent events - 2026-10-29: West reported Q3 2026 results. Net sales rose 8.7% to $874.5 million, and adjusted EPS rose 35.7% to $2.66. The company raised its guidance for 2026 to net sales of $3.41 billion to $3.42 billion and adjusted EPS of $9.38 to $9.48. It declared a Q4 dividend of $0.26 per share, up 18%. - 2026-10-29: West bought back $231 million of stock in Q3 and $685 million in the first nine months. About $314.7 million remains under its authorization of $1.0 billion. Its cash fell to $464.1 million from $791.3 million at the end of 2025. - 2026-10-26: West signed a new senior unsecured credit agreement with Bank of America as agent. It has a revolving facility of $750 million and a term loan of $200 million, and it matures on October 26, 2031. - 2026-07-14: West and Daikyo Seiko signed an amended and restated technology exchange and cross-license agreement and two distributor agreements. The terms are much like those of the agreements of 2017. West holds 49% of Daikyo. - 2026-07-01: West completed the sale of the manufacturing and supply rights for the SmartDose 3.5mL On-Body Delivery System and its factories to AbbVie for $126.9 million in cash. It booked a pre-tax gain of $55.7 million and expects savings of $15 million to $20 million a year. - 2026-06-01: West named Michel Lagarde, who was Chief Operating Officer of Thermo Fisher Scientific, as President and Chief Executive Officer from August 31, 2026. Eric Green, who told the board in March that he would retire, leaves the roles on that date. - 2026-05-11: West said that it found a material cyber attack on May 4, 2026. Some data was taken and some systems were encrypted, and the company took systems offline around the world. Core systems were back and shipping and making had restarted at some sites, but the full cost was not yet known. ## Latest news and filings - Last earnings: 2026-10-29 (8-K: https://www.sec.gov/Archives/edgar/data/105770/000010577026000118/) - Next earnings: 2027-02-11 (expected; the company has not confirmed it) | Filed | Form | Headline | Period end | XBRL document | Link | | --- | --- | --- | --- | --- | --- | | 2026-10-29 | 10-Q | Quarterly report for the period ended Sep 30, 2026 | 2026-09-30 | wst-20260930 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000121/wst-20260930.htm | | 2026-10-29 | 8-K | Earnings release and Investor disclosure | | wst-20261029 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000118/ | | 2026-10-26 | 8-K | New material agreement and End of a material agreement | | wst-20261026 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000114/wst-20261026.htm | | 2026-07-23 | 10-Q | Quarterly report for the period ended Jun 30, 2026 | 2026-06-30 | wst-20260630 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000099/wst-20260630.htm | | 2026-07-23 | 8-K | Earnings release and Investor disclosure | | wst-20260723 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000097/ | | 2026-07-14 | 8-K | New material agreement | | wst-20260714 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000093/wst-20260714.htm | | 2026-06-01 | 8-K | Change of directors or officers and Investor disclosure | | wst-20260531 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000080/wst-20260531.htm | | 2026-05-11 | 8-K | Investor disclosure | | wst-20260507 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000068/wst-20260507.htm | | 2026-05-05 | 8-K | Shareholder vote results | | wst-20260504 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000056/wst-20260504.htm | | 2026-04-23 | 10-Q | Quarterly report for the period ended Mar 31, 2026 | 2026-03-31 | wst-20260331 | https://www.sec.gov/Archives/edgar/data/105770/000010577026000049/wst-20260331.htm | Every filing on SEC EDGAR (CIK 105770): https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000105770&type=&dateb=&owner=include&count=40 ## Risks - Medium: Growth depends on a few kinds of customer demand. Sales of high-value components rose because of biologic and GLP-1 medicines. A slowdown in launches or in orders would cut growth and the margin. - Medium: The cyber attack of May 2026 can still cost money. The company said that it had one-time professional fees for it, and the investigation of the data that was taken was still open at the time of its first report. - Medium: A new chief executive started on August 31, 2026. Changes of plan or of managers can disturb a business that is growing fast. - Low: The West Vantage segment is weak. Its sales fell 7.3% in Q3, and its operating profit was $15.5 million, down from $22.3 million. - Low: West is the licensee of the Daikyo Crystal Zenith technology and holds 49% of Daikyo. A change in the agreements with Daikyo would hurt its delivery devices. ## Links - Page: https://picks.utilarium.app/company/WST/ - History of changes: https://picks.utilarium.app/company/WST/history/ - JSON with full history: https://picks.utilarium.app/data/company/WST.json > Picks is a personal record of stock picks. It gives general opinions about stocks, including a "Top pick" label. They are not tailored to your needs, goals or risk tolerance. Kevin is not a registered adviser and relies on the general-advice exemption in Canadian securities law (NI 31-103 s.8.25). Do your own research, or ask a registered adviser. Kevin may hold any stock on this site. Prices, intrinsic values and ratings can be delayed or wrong; check the original source. Full disclaimer: /disclaimer/.