AmerisourceBergen Corp. (NYSE:ABC)

The financial ratios presented demonstrate varying trends over the examined periods, indicating fluctuations in market valuation metrics relative to the company's earnings, operating profits, sales, and book value.

Price to Earnings (P/E) Ratio

The P/E ratio experienced significant volatility, starting at 47.54 in 2017, sharply declining to 11.36 in 2018, then rising again to 21.14 by 2019. Data for 2020 is absent, but the ratio decreased to 16.71 in 2021 and slightly increased to 19.94 in 2022. This pattern suggests fluctuating investor expectations regarding earnings growth or changes in earnings performance itself.

Price to Operating Profit (P/OP) Ratio

The P/OP ratio declined from 16.34 in 2017 to 13.05 in 2018, increased to 16.26 in 2019, with no data for 2020, then dropped to a low of 10.93 in 2021 before rising again to 14.32 in 2022. This trend signifies varying operating profit performance or changes in market valuation relative to operating profits, with the lowest ratio in 2021 possibly indicating a more attractive valuation or improved operating profit.

Price to Sales (P/S) Ratio

The P/S ratio remained relatively stable throughout the period, ranging narrowly between 0.10 and 0.14. The slight increase from 0.11 in 2017 and 2018 to 0.14 in 2022 may reflect modest increases in market valuation relative to sales or steady sales growth without proportionate price changes.

Price to Book Value (P/BV) Ratio

The P/BV ratio shows an unusual irregularity. It declined from 8.39 in 2017 to 6.28 in 2019, then an anomalous spike to 115.23 in 2021 is observed. Values for 2020 and 2022 are missing, preventing a continuous trend analysis. The spike may be attributed to extraordinary events affecting book value or market price, such as asset revaluation, goodwill impairment, or one-time accounting adjustments.

Overall, valuation ratios linked to earnings and operating profits manifested notable fluctuations, reflecting changing market perceptions or operational performance. The stability in the price to sales ratio suggests consistent revenue-related valuation. The significant inconsistency in the price to book value ratio warrants further investigation due to potential impactful accounting or market events during the period analyzed.

The analysis of the financial data over the period from September 30, 2017, to September 30, 2022, reveals several notable trends in the share price, earnings per share (EPS), and price-to-earnings (P/E) ratio.

Share Price

The share price exhibited a consistent upward trend throughout the period. Starting at $79.46 in 2017, it increased steadily each year, reaching $164.71 by 2022. This reflects a significant growth of more than 100% over five years, indicating strong market confidence and potential value appreciation.

Earnings Per Share (EPS)

The EPS displayed considerable volatility. It began at $1.67 in 2017, surged sharply to $7.83 in 2018, then declined to $4.15 in 2019. A substantial negative EPS of -$16.69 was reported in 2020, suggesting a severe earnings loss during that year, possibly due to extraordinary events or operational challenges. The company rebounded in 2021 and 2022, with EPS returning to positive figures of $7.40 and $8.26 respectively, indicating recovery and improved profitability.

Price-to-Earnings (P/E) Ratio

The P/E ratio fluctuated in alignment with EPS changes. In 2017, it was at a high of 47.54, dropped significantly to 11.36 in 2018, and rose to 21.14 in 2019. There is missing data for 2020, likely due to the negative EPS making the ratio meaningless. The P/E then settled into a range of 16.71 to 19.94 in 2021 and 2022, suggesting a normalized valuation relative to earnings post-recovery.

Share Price

The share price demonstrated a consistent upward trend from 2017 to 2022. Starting at $79.46 in 2017, it increased steadily over the years, reaching $164.71 by 2022. Notably, there was a significant increase between 2020 and 2022, indicating strong market confidence or improved outlook during that period.

Operating Profit Per Share

Operating profit per share showed variability over the analyzed period. It rose from $4.86 in 2017 to a peak of $6.81 in 2018, then declined to $5.40 in 2019. A sharp decline occurred in 2020, where the figure turned negative to -$25.14, suggesting a significant operational challenge or extraordinary loss. Following this downturn, the operating profit per share recovered markedly, reaching $11.31 in 2021 and slightly increasing to $11.51 in 2022, indicating a solid return to profitability.

Price to Operating Profit Ratio (P/OP)

Price to operating profit ratio fluctuated in response to changes in operating profit and share price. It decreased from 16.34 in 2017 to 13.05 in 2018, aligning with increased operating profit per share. The ratio rose again to 16.26 in 2019, reflective of the slight decrease in operating profit. The ratio is missing for 2020, likely due to the negative operating profit which makes this metric inapplicable. In subsequent years, the ratio decreased to 10.93 in 2021, then rose to 14.32 in 2022, which correlates with the recovery and growth in operating profit while the share price continued to increase.

Overall Analysis

The data reveals a period of operational difficulty in 2020, reflected in the negative operating profit per share and absence of a valid P/OP ratio. However, recovery was swift and pronounced, with strong increases in profitability and share price over the following two years. The rising share price throughout the period suggests sustained investor confidence despite volatility in operational performance. The P/OP ratio’s movement underscores the interplay between market valuation and underlying financial results, normalizing after the 2020 anomaly.

Share Price Trend

The share price exhibited a consistent upward trajectory from 2017 through 2022. Starting at $79.46 in 2017, the price rose to $88.87 in 2018, then experienced a slight dip to $87.81 in 2019. However, the price gained momentum afterward, increasing to $101.90 in 2020, $123.66 in 2021, and reaching $164.71 by 2022. Overall, this reflects a strong appreciation in market value over the six-year span.

Sales per Share Analysis

Sales per share increased steadily over the period. Beginning at $702.23 in 2017, the value rose year-over-year to $792.42 in 2018, $872.12 in 2019, and further advanced to $929.71 in 2020. The upward trend continued with $1,028.13 in 2021 and culminated at $1,160.06 in 2022. This consistent growth indicates improving revenue generation efficiency attributed to each share.

Price-to-Sales (P/S) Ratio Insights

The P/S ratio remained relatively stable through the period, fluctuating marginally between 0.10 and 0.14. It started at 0.11 in 2017 and stayed at that level in 2018, then slightly decreased to 0.10 in 2019. From 2020 onward, the ratio displayed a gradual increase to 0.11, 0.12, and finally 0.14 in 2022. This upward shift suggests that the market valuation per dollar of sales has increased, possibly reflecting investor confidence or improved profitability expectations relative to sales growth.

Overall Interpretation

The data indicates a robust growth profile in both share price and sales per share for the period analyzed, with the P/S ratio reflecting a modest increase in valuation multiples. The consistent rise in sales per share paired with significant share price appreciation suggests positive investor sentiment and effective operational performance. The stability and slight increase in the P/S ratio imply that valuation expansions are supported by underlying sales growth rather than speculative market behavior.

Share Price Trend

The share price of the company exhibited a generally upward trajectory over the analyzed period. Starting at $79.46 in September 2017, the price increased to $88.87 in 2018 and slightly declined to $87.81 in 2019. From 2020 onwards, the share price showed substantial growth, rising to $101.90 in 2020, $123.66 in 2021, and reaching a peak of $164.71 in 2022. This trend reflects increasing investor confidence or favorable market conditions affecting the stock.

Book Value Per Share (BVPS) Trend

The book value per share showed relative stability initially, moving from $9.47 in 2017 to $13.84 in 2018 and slightly increasing to $13.98 in 2019. However, a significant deterioration occurred in 2020 when BVPS turned negative to -$4.99. The figure marginally recovered to $1.07 in 2021 but declined again to -$1.03 in 2022. This volatility in book value per share may indicate fluctuations in the underlying equity base or asset valuations during this timeframe.

Price-to-Book Value (P/BV) Ratio Analysis

The price-to-book value ratio started at a high level of 8.39 in 2017, decreased steadily to 6.42 in 2018 and 6.28 in 2019. Data for 2020 is missing; however, in 2021, the P/BV ratio surged dramatically to an exceptionally high value of 115.23, with no data available for 2022. This sharp increase in the ratio for 2021 is primarily due to the very low book value per share in that year, which causes the P/BV ratio to inflate significantly. Such an elevated P/BV ratio ratio suggests potentially overvalued shares relative to book value or may reflect accounting or one-time adjustments affecting equity.