Texas Permanent School Fund Cuts Stake in West Pharmaceutical Services

Texas Permanent School Fund Corp has significantly reduced its investment in West Pharmaceutical Services, Inc. by selling 10,253 shares during the second quarter of 2023. According to the latest 13F filing with the Securities and Exchange Commission, the fund now holds 11,148 shares of the medical instruments supplier, valued at approximately $2,439,000. This represents a 47.9% decrease in their stake.

The reduction in holdings by Texas Permanent School Fund Corp comes amid a broader trend of institutional investors adjusting their positions in West Pharmaceutical Services. Osaic Holdings Inc. increased its investment by 15.2% in the same quarter, acquiring an additional 1,647 shares for a total of 12,461 shares, valued at around $2,742,000. Meanwhile, the State of Wyoming established a new stake valued at $49,000, and Hudson Bay Capital Management LP acquired shares worth $373,000.

Nomura Holdings Inc. also expanded its position by 4.2%, now owning 5,246 shares worth approximately $1,148,000. Caxton Associates LLP entered the fray by acquiring a new stake valued at $1,610,000. In total, institutional investors now own 93.90% of West Pharmaceutical Services’ stock.

Analysts Upgrade Ratings and Price Targets

Recent commentary from equity analysts has been favorable towards West Pharmaceutical Services. Wall Street Zen recently upgraded the stock from a “hold” rating to a “buy” rating on September 15, 2023. Rothschild & Co Redburn also classified the stock as a “strong-buy,” setting a price target of $311.00.

Additionally, Evercore ISI raised its price objective on the stock from $350.00 to $390.00 and awarded it an “outperform” rating. Current consensus ratings show that two investment analysts regard the stock as a strong buy, eight have given it a buy rating, and four classify it as a hold. According to data from MarketBeat.com, West Pharmaceutical Services has a consensus rating of “Moderate Buy” and a price target of $342.20.

Stock Performance and Financial Outlook

As of the close on October 23, 2023, shares of West Pharmaceutical Services (NYSE:WST) opened at $272.31. The company has experienced a one-year low of $187.43 and a high of $348.90. With a market capitalization of $19.59 billion, West Pharmaceutical Services reports a price-to-earnings ratio of 40.34 and a price-to-earnings-growth ratio of 4.21.

The company recently announced earnings for the third quarter of 2023, revealing earnings per share (EPS) of $1.96, surpassing analyst expectations of $1.67 by $0.29. Revenue for the quarter reached $804.60 million, exceeding the consensus estimate of $788.42 million and reflecting a 7.7% increase from the previous year. The company has set its fiscal year 2025 guidance at 7.060-7.110 EPS.

Furthermore, West Pharmaceutical Services announced a quarterly dividend of $0.22, payable on February 4, 2024, to shareholders of record as of January 28, 2024. This dividend translates to an annualized payout of $0.88 and represents a yield of 0.3%. The company’s current payout ratio stands at 13.04%.

West Pharmaceutical Services, Inc. is recognized as a global leader in the development and manufacturing of components, systems, and services that facilitate the delivery of injectable drugs. The company specializes in high-quality packaging solutions for the pharmaceutical and biotech industries, producing critical components such as elastomeric closures and specialized drug delivery devices utilized in vaccines and other injectable therapies.