Intrinsic Value Pharmagest Interactive S.A. (PHA.PA)

• Previous Close: €84.50
• Intrinsic Value: n/a
• Upside potential: n/a%

Stock Valuation Context

Business Model And Market Position

Pharmagest Interactive SA is a leading European provider of IT solutions tailored for the healthcare sector, specializing in pharmacy management, patient support, and digital health tools. The company operates in the healthcare information services industry, offering a comprehensive suite of software and services that streamline pharmacy operations, enhance patient engagement, and improve care coordination. Its solutions, such as LGPI global services, OffiCentral, and eNephro, cater to pharmacies, wholesalers, and healthcare professionals, positioning Pharmagest as a critical enabler of digital transformation in European healthcare. The company’s diversified product portfolio, including compliance monitoring, teleconsultation, and retail management tools, underscores its ability to address evolving regulatory and operational demands. Pharmagest’s subsidiary structure under Marque Verte Sante provides strategic stability, while its focus on innovation—evident in offerings like AXIGATE and CHORUS—reinforces its competitive edge in a fragmented market. By integrating analytics, automation, and patient-centric solutions, the company has carved a niche as a trusted partner for pharmacies and healthcare providers seeking efficiency and compliance.

Revenue Profitability And Efficiency

In FY 2021, Pharmagest reported revenue of €193.1 million, reflecting its steady demand in the healthcare IT space. Net income stood at €41.2 million, with diluted EPS of €1.31, indicating robust profitability. Operating cash flow of €47.5 million and capital expenditures of €10.4 million suggest efficient cash generation and disciplined reinvestment, supporting its growth initiatives.

Earnings Power And Capital Efficiency

The company’s net income margin of approximately 21.4% highlights strong earnings power, driven by its subscription-based software model and scalable solutions. With operating cash flow covering capital expenditures by a factor of 4.6x, Pharmagest demonstrates capital efficiency, enabling reinvestment in R&D and strategic acquisitions without compromising financial stability.

Balance Sheet And Financial Health

Pharmagest maintained a solid liquidity position with €34.8 million in cash and equivalents, though total debt of €76.5 million indicates moderate leverage. The balance sheet remains manageable, with debt likely supporting growth initiatives. The absence of reported market cap data limits a full assessment of leverage ratios, but the company’s cash flow generation provides a buffer for debt servicing.

Growth Trends And Dividend Policy

The company’s dividend payout of €22.68 per share signals a commitment to shareholder returns, supported by stable cash flows. Growth is likely fueled by organic expansion into digital health tools and potential M&A, though specific revenue growth rates are undisclosed. The focus on high-margin software solutions positions Pharmagest for sustained profitability.

Valuation And Market Expectations

With a beta of 0.94, Pharmagest’s stock exhibits moderate sensitivity to market movements, typical for healthcare IT firms. The lack of reported market cap limits traditional valuation metrics, but its profitability and dividend yield suggest investor confidence in its recurring revenue model and sector tailwinds.

Strategic Advantages And Outlook

Pharmagest’s deep domain expertise and integrated software suite provide a moat in the European healthcare IT market. Regulatory tailwinds for digital health adoption and pharmacy automation bode well for future demand. Challenges include competition and integration risks, but the company’s innovation pipeline and subsidiary backing position it for resilient performance.

Sources

Company filings, Euronext Paris disclosures