| Valuation method | Value, CHF | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 43.63 | -38 |
| Intrinsic value (DCF) | 21.77 | -69 |
| Graham-Dodd Method | 14.57 | -79 |
| Graham Formula | 20.40 | -71 |
Bachem Holding AG (BANB.SW) is a leading Swiss-based provider of peptide and oligonucleotide active pharmaceutical ingredients (APIs) for pharmaceutical and biotechnology companies worldwide. Founded in 1971 and headquartered in Bubendorf, Switzerland, Bachem specializes in the development, production, and regulatory support of high-purity peptides, oligonucleotides, and other complex molecules used in research, clinical development, and commercial applications. The company operates in the Chemicals sector under Basic Materials, offering a vertically integrated business model that includes research-grade production, GMP manufacturing, and analytical services. Bachem serves a global clientele, supporting drug development from early-stage research to commercialization, with a strong emphasis on quality and regulatory compliance. With a market capitalization of CHF 3.67 billion, Bachem is a key player in the peptide synthesis market, benefiting from increasing demand for peptide-based therapeutics in areas such as oncology, diabetes, and rare diseases.
Bachem Holding AG presents a compelling investment case due to its strong position in the specialized peptide and oligonucleotide API market, which is experiencing robust growth driven by advancements in biopharmaceuticals. The company's revenue of CHF 605.3 million and net income of CHF 120.2 million in the latest fiscal year reflect solid profitability, supported by a diversified customer base and high barriers to entry in its niche. Bachem's operating cash flow of CHF 146.3 million and minimal debt (CHF 290,000) indicate financial stability, though significant capital expenditures (CHF -273.8 million) suggest ongoing investment in capacity expansion. Risks include exposure to biotech funding cycles and potential pricing pressures in the generics segment. The dividend yield, with a payout of CHF 0.85 per share, adds appeal for income-focused investors. Given its technological expertise and market leadership, Bachem is well-positioned to capitalize on the growing demand for peptide therapeutics.
Bachem Holding AG holds a competitive advantage in the peptide and oligonucleotide API market due to its decades of expertise, vertically integrated operations, and stringent quality standards. The company's ability to handle complex molecules and provide end-to-end solutions—from research-grade to commercial-scale GMP production—differentiates it from smaller competitors. Bachem's Swiss manufacturing base enhances its reputation for reliability and regulatory compliance, critical for serving global pharmaceutical clients. However, the company faces competition from larger chemical and life science firms with broader portfolios and greater economies of scale. Bachem's focus on peptides and oligonucleotides allows for deep specialization but may limit diversification compared to rivals offering a wider range of APIs. The company's investment in capacity expansion (evidenced by high capex) aims to solidify its market position amid rising demand for peptide-based drugs. Pricing pressure from generics and potential supply chain disruptions are key challenges. Overall, Bachem's niche expertise and strong client relationships underpin its competitive moat, though it must continue innovating to maintain leadership against larger players.