# Hikma Pharmaceuticals (HIK.LSE)

Canonical: https://gigainvestors.com/s/HIK.LSE

Analysis as of: 2026-10-16T07:37:51.274Z. Financial observations: FY2002–FY2025.

Listing currency: GBX. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: GBX 1,642.00 per share; close as of 2026-10-15.

Estimated value: low GBX 1,701.14 per share, central GBX 1,924.47 per share, high GBX 2,221.78 per share. Buy at or below the central value GBX 1,924.47 per share. Valuation as of 2026-10-16T07:37:51.274Z; scenarios are not confidence intervals.

Expected annual return: 11.3% at the stated quote. About 11.3% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; GB 10-year bond 5.4% + 4 points).

## Checklist

### understandable: pass

- 2 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 2

- Years with a net loss: 1

- Operating margin variation: 0.17×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.21×

- FY2017: 0.17×

- FY2018: 0.21×

- FY2019: 0.22×

- FY2020: 0.23×

- FY2021: 0.25×

- FY2022: 0.23×

- FY2023: 0.13×

- FY2024: 0.20×

- FY2025: 0.17×

### moat: fail

- Recent gross margin fell 5.8pp below the typical margin (limit 4pp)

- ROIC, median of available years: 16.6%

- ROIC, second-lowest year: 12.6%

- Typical minus recent gross margin: 5.8 pp

- Typical gross margin (annual median): 48.8%

- Recent gross margin (lower of latest and 3-year median): 43.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 6.1%

- ROIC including acquisitions, ten-year median: 12.5%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 12.6%

- FY2017: 15.1%

- FY2018: 23.8%

- FY2019: 23.5%

- FY2020: 17.1%

- FY2021: 19.1%

- FY2022: 17.7%

- FY2023: 9.0%

- FY2024: 16.1%

- FY2025: 13.2%

### economics: pass

- Owner earnings / net income, 5-yr: 1.00×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $1.6B

- Net income, five-year total: $1.6B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -0.1 pp

- Working capital / revenue, change between three-year averages: -0.6 pp

- Working capital / revenue, final three-year average: 46.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.96×

- FY2022: 0.76×

- FY2023: 1.08×

- FY2024: 1.06×

- FY2025: 1.06×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 15.1% vs 13.2%

- Per-share earnings: 0.64 to 1.61 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 1.0%

- Ordinary dilution, 5-year annual growth: -0.9%

- Market cap gain: -$1.5B

- Cumulative retained earnings: $1.3B

- Diluted shares, 10-year annual growth: 1.0%

- Diluted shares, 5-year annual growth: -0.9%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 12.2%

- Per-share value change: $0.97

- Per-share value, starting three-year median: $0.64

- Per-share value, ending three-year median: $1.61

- Buybacks concentrated in cheaper years (correlation): -1.00

- Average buyback yield: 4.1%

- Buyback history: 3 years

- Debt-funded buybacks: Yes

- Acquisition spending: $1.5B

- Cumulative net income, 10 years: $2.1B

- ROIC, first three-year median: 15.1%

- ROIC, last three-year median: 13.2%

Chart: Earnings per share; fiscal year observations.

- FY2016: $0.64

- FY2017: -$3.70

- FY2018: $1.17

- FY2019: $2.00

- FY2020: $1.85

- FY2021: $1.80

- FY2022: $0.85

- FY2023: $0.85

- FY2024: $1.61

- FY2025: $1.84

### accounting: pass

- Sloan accruals: 0.8%

- Receivables to sales index (DSRI): 1.11×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 6.3%

- Earnings backed by cash: Yes

- Operating cash / earnings: 0.89×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.45×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -3.2%

- FY2017: -38.0%

- FY2018: -4.2%

- FY2019: 0.4%

- FY2020: -0.8%

- FY2021: -5.0%

- FY2022: -7.6%

- FY2023: -8.9%

- FY2024: -4.0%

- FY2025: 0.8%

## Holders

## Price story

Down 32% since Oct 2021 · sales +7.1%

Story as of 2026-10-16T10:00:09.519Z; price observation 2026-10-15.

Price needs cash profits to shrink 1.2% a year for ten years

- 2026-08-06: Hikma jumps 10% as brokers point to profit beat and undemanding rating ([finance.yahoo.com](https://finance.yahoo.com/healthcare/articles/hikma-jumps-10-brokers-point-093000533.html))

### Sales · FY2024–2025

sales +7.1%; source https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html; observed 2026-03-18.

- FY2016: $2.0B 

- FY2017: $1.9B 

- FY2018: $2.1B 

- FY2019: $2.2B 

- FY2020: $2.3B 

- FY2021: $2.6B 

- FY2022: $2.5B 

- FY2023: $2.9B 

- FY2024: $3.1B 

- FY2025: $3.3B 

### Gross margin · FY2025

gross margin 43%; source https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html; observed 2026-03-18.

- FY2016: 48.7% 

- FY2017: 47.3% 

- FY2018: 48.5% 

- FY2019: 49.8% 

- FY2020: 51.8% 

- FY2021: 51.0% 

- FY2022: 50.3% 

- FY2023: 48.9% 

- FY2024: 45.3% 

- FY2025: 43.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in drug manufacturers specialty & generic; annual sales are USD 3.3 billion.

- Source: https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html (filed 2026-03-18); FY2025: revenue 3349000000; grossProfit 1441000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 43% to 48.9% during 2023–25; it earns 16.6% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2023: grossProfit / revenue = 48.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2024: grossProfit / revenue = 45.3%.

- Source: https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html (filed 2026-03-18); FY2025: grossProfit / revenue = 43%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); 10-year return on capital observations [[2016,0.12576271859306457],[2017,0.15081818181818182],[2018,0.2384387131581108],[2019,0.2345696998528253],[2020,0.17117607250434577],[2021,0.19090690098192162],[2022,0.17700687291150832],[2023,0.09046232533777018],[2024,0.16117507120486269],[2025,0.13179198802672115]]; median 0.16617557185460424. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years; bought back USD 36.8 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2016: growth capex 0; upkeep 122000000; owner earnings 179000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2017: growth capex 0; upkeep 107000000; owner earnings 291000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2018: growth capex 0; upkeep 107000000; owner earnings 296000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2019: growth capex 58440584.120486155; upkeep 127559415.87951384; owner earnings 443840584.12048614. Growth capex / owner earnings = 0.131670212710025.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2020: growth capex 59951599.80894408; upkeep 164048400.19105592; owner earnings 381761910.8089441. Growth capex / owner earnings = 0.15703923862364402.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2021: growth capex 61217666; upkeep 167782334; owner earnings 404400000. Growth capex / owner earnings = 0.15137899604352126.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2022: growth capex 0; upkeep 225000000; owner earnings 142000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2023: growth capex 0; upkeep 169000000; owner earnings 205800000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); FY2024: growth capex 0; upkeep 165000000; owner earnings 380157737. Growth capex / owner earnings = 0.

- Source: https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html (filed 2026-03-18); FY2025: growth capex 0; upkeep 201133119; owner earnings 436700962. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); Dividend observations: [[2016,77000000],[2017,79000000],[2018,84000000],[2019,97000000],[2020,109000000],[2021,120000000],[2022,125000000],[2023,137000000],[2024,175000000],[2025,188881356]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html (filed 2026-03-18); FY2025: cash repurchases 36755290 USD.

### Are managers owners

Insiders own 32.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); HIK.LSE SharesStats.PercentInsiders = 32.389 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits shrink 1.2% yearly over ten years; actual growth was 5.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-18); Ten-year compound average after fade. Initial solved rate -0.02953244660073856. Price 1642; FX 75.34943299551671; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 1.1683168316831682 → FY2025 1.95798419089295. Closing-price date 2026-10-15.

## Monthly share-price history (GBX per share)

- 2016-10: GBX 1,754.00 per share

- 2016-11: GBX 1,701.00 per share

- 2016-12: GBX 1,893.00 per share

- 2017-01: GBX 1,824.00 per share

- 2017-02: GBX 2,150.00 per share

- 2017-03: GBX 1,981.00 per share

- 2017-04: GBX 1,937.00 per share

- 2017-05: GBX 1,688.00 per share

- 2017-06: GBX 1,470.00 per share

- 2017-07: GBX 1,412.00 per share

- 2017-08: GBX 1,252.00 per share

- 2017-09: GBX 1,211.00 per share

- 2017-10: GBX 1,164.00 per share

- 2017-11: GBX 1,030.00 per share

- 2017-12: GBX 1,134.00 per share

- 2018-01: GBX 967.00 per share

- 2018-02: GBX 861.60 per share

- 2018-03: GBX 1,208.50 per share

- 2018-04: GBX 1,288.00 per share

- 2018-05: GBX 1,352.00 per share

- 2018-06: GBX 1,501.00 per share

- 2018-07: GBX 1,641.00 per share

- 2018-08: GBX 1,972.00 per share

- 2018-09: GBX 1,850.00 per share

- 2018-10: GBX 1,901.50 per share

- 2018-11: GBX 1,781.00 per share

- 2018-12: GBX 1,716.00 per share

- 2019-01: GBX 1,610.50 per share

- 2019-02: GBX 1,668.50 per share

- 2019-03: GBX 1,791.50 per share

- 2019-04: GBX 1,765.50 per share

- 2019-05: GBX 1,580.00 per share

- 2019-06: GBX 1,722.00 per share

- 2019-07: GBX 1,840.50 per share

- 2019-08: GBX 2,017.00 per share

- 2019-09: GBX 2,200.00 per share

- 2019-10: GBX 2,010.00 per share

- 2019-11: GBX 1,915.00 per share

- 2019-12: GBX 1,991.00 per share

- 2020-01: GBX 1,832.00 per share

- 2020-02: GBX 1,788.00 per share

- 2020-03: GBX 2,035.00 per share

- 2020-04: GBX 2,370.00 per share

- 2020-05: GBX 2,571.00 per share

- 2020-06: GBX 2,220.00 per share

- 2020-07: GBX 2,150.00 per share

- 2020-08: GBX 2,371.00 per share

- 2020-09: GBX 2,594.00 per share

- 2020-10: GBX 2,510.00 per share

- 2020-11: GBX 2,608.00 per share

- 2020-12: GBX 2,518.00 per share

- 2021-01: GBX 2,399.00 per share

- 2021-02: GBX 2,236.00 per share

- 2021-03: GBX 2,276.00 per share

- 2021-04: GBX 2,440.00 per share

- 2021-05: GBX 2,444.00 per share

- 2021-06: GBX 2,446.00 per share

- 2021-07: GBX 2,646.00 per share

- 2021-08: GBX 2,538.00 per share

- 2021-09: GBX 2,450.00 per share

- 2021-10: GBX 2,407.00 per share

- 2021-11: GBX 2,215.00 per share

- 2021-12: GBX 2,219.00 per share

- 2022-01: GBX 2,078.00 per share

- 2022-02: GBX 2,083.00 per share

- 2022-03: GBX 2,061.00 per share

- 2022-04: GBX 1,883.50 per share

- 2022-05: GBX 1,698.50 per share

- 2022-06: GBX 1,617.50 per share

- 2022-07: GBX 1,730.00 per share

- 2022-08: GBX 1,313.00 per share

- 2022-09: GBX 1,363.50 per share

- 2022-10: GBX 1,249.00 per share

- 2022-11: GBX 1,514.00 per share

- 2022-12: GBX 1,552.00 per share

- 2023-01: GBX 1,708.50 per share

- 2023-02: GBX 1,732.00 per share

- 2023-03: GBX 1,675.00 per share

- 2023-04: GBX 1,841.00 per share

- 2023-05: GBX 1,791.50 per share

- 2023-06: GBX 1,890.50 per share

- 2023-07: GBX 2,089.00 per share

- 2023-08: GBX 2,189.00 per share

- 2023-09: GBX 2,088.00 per share

- 2023-10: GBX 1,901.50 per share

- 2023-11: GBX 1,723.50 per share

- 2023-12: GBX 1,789.00 per share

- 2024-01: GBX 1,931.50 per share

- 2024-02: GBX 1,967.00 per share

- 2024-03: GBX 1,918.50 per share

- 2024-04: GBX 1,924.00 per share

- 2024-05: GBX 1,930.00 per share

- 2024-06: GBX 1,891.00 per share

- 2024-07: GBX 1,904.00 per share

- 2024-08: GBX 1,983.00 per share

- 2024-09: GBX 1,911.00 per share

- 2024-10: GBX 1,855.00 per share

- 2024-11: GBX 1,924.00 per share

- 2024-12: GBX 1,993.00 per share

- 2025-01: GBX 2,292.00 per share

- 2025-02: GBX 2,160.00 per share

- 2025-03: GBX 1,949.00 per share

- 2025-04: GBX 1,985.00 per share

- 2025-05: GBX 2,140.00 per share

- 2025-06: GBX 1,988.00 per share

- 2025-07: GBX 1,964.00 per share

- 2025-08: GBX 1,785.00 per share

- 2025-09: GBX 1,698.00 per share

- 2025-10: GBX 1,839.00 per share

- 2025-11: GBX 1,554.00 per share

- 2025-12: GBX 1,550.00 per share

- 2026-01: GBX 1,529.00 per share

- 2026-02: GBX 1,314.00 per share

- 2026-03: GBX 1,261.00 per share

- 2026-04: GBX 1,398.50 per share

- 2026-05: GBX 1,476.00 per share

- 2026-06: GBX 1,520.00 per share

- 2026-07: GBX 1,585.00 per share

- 2026-08: GBX 1,616.00 per share

- 2026-09: GBX 1,618.00 per share

- 2026-10: GBX 1,642.00 per share

## Annual estimated value (GBX per share)

- FY2016: low GBX 1,339.70 per share, central GBX 1,895.69 per share, high GBX 2,219.44 per share

- FY2017: low GBX 1,171.00 per share, central GBX 1,322.87 per share, high GBX 1,525.05 per share

- FY2018: low GBX 1,138.52 per share, central GBX 1,284.52 per share, high GBX 1,478.89 per share

- FY2019: low GBX 1,255.35 per share, central GBX 1,410.44 per share, high GBX 1,616.89 per share

- FY2020: low GBX 1,570.18 per share, central GBX 2,097.83 per share, high GBX 2,441.81 per share

- FY2021: low GBX 1,551.79 per share, central GBX 1,748.04 per share, high GBX 2,009.28 per share

- FY2022: low GBX 1,562.42 per share, central GBX 1,766.52 per share, high GBX 2,038.23 per share

- FY2023: low GBX 1,741.91 per share, central GBX 1,974.08 per share, high GBX 2,283.15 per share

- FY2024: low GBX 1,534.28 per share, central GBX 1,841.45 per share, high GBX 2,136.94 per share

- FY2025: low GBX 1,600.45 per share, central GBX 1,807.74 per share, high GBX 2,083.69 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:43:39.025Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original ESEF filing](https://filings.xbrl.org/549300BNS685UXH4JI75/2025-12-31/ESEF/GB/0/549300BNS685UXH4JI75-2025-12-31/reports/549300BNS685UXH4JI75-2025-12-31-T01.html); period 2025-12-31, filed 2026-03-18.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations