Roche Analysis 6/26

DISCLOSURE: as of 6/26 I have no open position in RO

Roche is a Swiss based pharmaceutical conglomerate with a diverse range of operations and brands. The company has a long history of profitability and high returns on investment.

Management Effectiveness: Roche has been around since 1896 and has had consistent growth over the economic cycles. Return on equity has been averaging 40% and although margins have compressed in recent years the company remains highly profitable and in a stable leverage position.



Valuation: With a price to earnings of 20 and price to cash flow of 15 if looks potentially undervalued. I like companies that have a return on equity double that of the price to earnings, and that rule of thumb is met in this case.



Summary: Roche looks like a quality company to potentially take some profits and diversify from my SIGA position. However, for now it will stay on the watch list. I will be looking at USDCHF as well as the valuation metrics I mentioned above.

Here on my macroeconomic and current research shortlist watchlists:

tradingview.com/watchlists/153985520/
tradingview.com/watchlists/150658502/

Thanks for reading, have a good one