On Thursday, West Pharmaceutical Services, Inc. (NYSE:WST) reported a fourth-quarter adjusted EPS of $1.82, beating the consensus of $1.72.

The designer and manufacturer of injectable pharmaceutical packaging and delivery systems reported sales of $748.8 million, beating the consensus of $740.47 million.

The Proprietary Products Segment's sales increased by 3.4% to $613.9 million, and the organic net sales growth was 4.5%.

High-value products (components and devices) represented around 74% of segment net sales, led by customer demand for self-injection device platforms. Fourth-quarter sales included a benefit of approximately $25 million in customer incentives earned in connection with volumes achieved related to HVP Delivery Devices.

The Biologics market unit experienced high-single-digit organic net sales growth, driven by an increase in sales of self-injection device platforms, offset by lower sales of NovaPure products.

The Pharma market unit saw mid-single-digit organic net sales growth, driven by an increase in Westar products and Administrative Systems sales.

The Generics market unit had a mid-single digit organic net sales decline, driven by lower volumes of FluroTec products.

Sales in the Contract-Manufactured Products Segment declined by 2.5% to $134.9 million, while organic net sales declined by 2.0%. Segment performance was driven by a continued decrease in sales of healthcare diagnostic devices, partially offset by growth in self-injection devices for obesity and diabetes.

Guidance: West Pharmaceutical Services forecasts 2025 adjusted EPS of $6.00-$6.20 below the consensus of $7.44.

The company expects 2025 revenues of $2.875 billion-$2.91 billion versus a consensus of $3.04 billion.

• Organic net sales growth is expected to be approximately 2% to 3%.
• Net sales guidance includes an estimated full-year 2025 headwind of $75 million based on current foreign currency exchange rates.

"Looking ahead to 2025, we expect our business momentum to continue in key areas of our Proprietary Products business, driven by improving High-Value Products trends in Biologics and Generics, and growth driven by Annex 1 and GLP-1. We are focused on operational excellence and driving strong returns in 2025," said Eric Green, President, Chief Executive Officer and Chair.

William Blair writes that West Pharmaceutical stock currently trades at 52.8 times the midpoint of the company's 2025 adjusted EPS guidance.

"Generally speaking, we expect the stock to track to earnings growth that we peg in the low- to midteens long term; however, we believe both 1) that growth profile may not return until mid-to late 2025 and 2) much of the alpha will be recaptured moving into that return-to growth," writes analyst Matt Larew.

William Blair reiterates the Outperform rating.

Price Action: On Thursday’s last check, WST stock was down 33.90% at $213.25.

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