GSK

Analysis of GSK share price

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Latest news

GSK demerger reveals details to investors

24/06/2021 - 13h49

GSK's reorganisation plan has just been detailed to investors who are relieved by the decisions taken. Let's find out the details of this news as well as the latest information.

Elements that can influence the price of this asset:

Analysis N°1

We would particularly monitor the different strategic agreements that this company could implement with other pharmaceutical companies and organisations with the aim of furthering research and innovations.

Analysis N°2

The increasing sensitivity of countries and individuals to health requirements is also a significant growth indicator for this asset.

Analysis N°3

We would also follow merger and acquisition operations of this company that could, through their intermediary, increase this company’s global presence and its development in certain strategic markets.

Analysis N°4

It is also recommended to evaluate the risks related to new products launched on the market that could be disappointing in terms of sales after major investments in their development.

Analysis N°5

We would also monitor the regulations in this activity sector and watch for any major changes in them that may cause an increase or decrease in sales of the GSK Company.

Analysis N°6

Finally, the worldwide economic health will also of course exert a direct impact on the demand for medicines and health care.

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General presentation of GSK

Before delving further into our study of the GSK Company, we would remind you of certain key facts concerning this company and its main activities. With a significant understanding of this group as well as the products and services it provides you will have an increased perception of how it may develop in the coming years and therefore how its share price may evolve on the stock markets.

The GSK Group is a British company specialised in the pharmaceutical sector. More precisely, it is currently the second largest company in this activity sector worldwide.

To better understand the activities of the GSK Group it is possible to categorise the different sectors according to the turnover they each generate and how:

  • The production and sale of pharmaceutical products represent the major part of this company’s activities with over 56% of its turnover. These products are particularly destined for the treatment of respiratory illnesses with 41% of the turnover, HIV infection treatments at 27.3% of the turnover, and treatment of immune system problems with 2.7% of this company’s turnover.
  • The production and sale of OTC and para-pharmaceutical medicines represent nearly 29.8% of this company’s turnover.
  • Finally, the production and sale of vaccines generates 19.1% of the group’s turnover.

It can also be advantageous to know the geographical distribution of this group’s income which operates on an international level. In fact, only 3% of this company’s turnover is generated in the United Kingdom. The largest market of the GSK Group is the United States which generates 38.9% of its turnover, the remaining 58.1% is derived from various countries around the world.

Analysis of GSK share price
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The major competitors of GSK

Now that you are familiar with the activities of the GSK Company we offer you the opportunity to learn about the environment in which this group operates. In fact it is essential to know each of this company’s competitors very well so you can take them into account in your future analyses. Here therefore is a detailed summary about each of this company’s main competitors:

Johnson & Johnson

The major competitor of this sector is the American Group Johnson & Johnson which is one of the leading companies in the well being and health care sector with a range of pharmaceutical products in particular including medicines for the treatment of cardio-vascular illnesses, gastro-enteritis, immune problems, as well as dermatological and neurological problems. This group also produces and sells medical equipment and consumer medical products with OTC medicines and ophthalmological products among others. It actually owns 111 production sites throughout the world.  

Roche

Then we find the Roche Group which is specialised in the area of health research wherein the activities are divided into two with the pharmaceutical sector again in two parts with Roche Pharmaceutical and Chugai, and the diagnostics sector which is composed of four main divisions with diabetes, molecular diagnostics, professional diagnostics and tissue diagnostics. The group also develops treatments in different therapeutic areas including oncology, immunity, infectious diseases, ophthalmology and neuroscience.

Merck

The Merck Group holds third position and is notably engaged in the development, production and sale of therapeutic products and prescribed vaccines. Among the activities of this group we note the sale of pharmaceutical products for the treatment of hypertension, osteoporosis, atherosclerosis, respiratory problems, bacterial and fungal problems, ophthalmological and urological illnesses, severe migraines, hair loss and other problems and illnesses. This company also sells vaccines and animal healthcare products.

Novartis 

Still on the subject of GSK’s competitors we find the Novartis Group which is one of the leading companies in the creation, production and sale of pharmaceutical products for the treatment of cardio-vascular illnesses, respiratory and dermatological problems, gastro intestinal infections, cancers, dysfunctions related to the central nervous system, and hormonal problems among others. It also produces and sells generic medicines and ocular care products. It currently employs over 125,160 workers.

Pfizer

The Pfizer Company is another significant competitor to the GSK Company and is in fact the leader of the pharmaceutical sector worldwide. It specialises in vaccines, oncology and pharmaceutical products for the general public as well as generic medicines. It sells its products mainly in the United States and Germany.

Novo Nordisk

We then also find the company Novo Nordisk which is specialised in the creation, production and sale of pharmaceutical products with medicines for the treatment of diabetes, obesity, haemophilia, plus growth hormones and hormone replacement products.

Amgen

In the United States the Amgen Group is also a company to be monitored as a leading group worldwide in the sector of biotechnology. It notably produces and sells medicines for the treatment of cancer, metabolic problems, bone diseases, renal deficiencies and haemophilia.

Astrazeneca

We would also closely follow the Astrazeneca group which is one of the top pharmaceutical groups worldwide and produces treatments for cardio-vascular and metabolic illnesses, respiratory and oncology illnesses as well as inflammatory problems, auto-immune illnesses, neurological and gastro-intestinal illnesses, as well as infectious diseases. It also offers study and research services for third parties.

Sanofi

Finally, we would also recommend monitoring the Sanofi Company which is one of the leaders in this sector in Europe and which notably produces pharmaceutical treatments for cardiovascular illnesses, thrombosis, problems with the central nervous system (insomnia, multiple sclerosis, epilepsy), cancers and allergies amongst others. It also produces OTC and generic medicines as well as human vaccines. It owns 75 production sites worldwide and exercises its activities on an international level.


The major partners of GSK

Let us now examine the different partnerships that the GSK Group has implemented over recent years which have strongly influenced its stock market share price. In fact, these strategic alliances have often been followed by interesting movements of its share price on the stock markets so it can be beneficial to know how to detect them in advance and interpret them. Here therefore are some examples of this type of partnership.

Myogen

Firstly, in 2006 the GSK Group announced a strategic partnership with the Myogen Company which led to a significant rise in their share prices on the stock markets. This partnership was related to the distribution of a new treatment for pulmonary arterial hypertension. It was in fact the Myogen Group that held the rights to this new treatment named Ambrisentan which was then undergoing phase III clinical trials. It offered GSK the distribution rights to this treatment on the American market. Also within the framework of this agreement, Myogen received an initial payment of 20 million dollars followed by a further payment of 80 million dollars depending on the sales figures and supplementary royalties.

Siemens

Much later, in 2016 to be more precise, the group signed another strategic partnership with the Siemens Company. This strategic partnership that was on a global level enabled GSK to benefit from Siemens as a choice partner to strongly develop its automated production. In fact, within the framework of this agreement, Siemens became the favoured provider of GSK’s production, research and development sites worldwide. This new agreement actually consolidated a long standing partnership between the two companies and enabled GSK to renew its global strategy in terms of automation. Precise criteria were agreed with the establishment of this collaboration, notably in relation to the general direction of the two companies towards full support of this partnership and the promotion of transparency founded on mutual trust. Siemens and GSK thereby sought to create added value in terms of refined procedures, automated equipment and the control of supply and demand as well as automated systems of construction for this British laboratory’s sites. This alliance notably targeted modular production areas, the manufacturing of sterile batches of products, optimisation of machines and production lines and the production of medicines.

Google

Still in 2016, GSK implemented a far reaching partnership with the American internet giant Google. In fact, the two companies created a joint company through the Google subsidiary Verily Life Science of which the American company held 45% with the majority held by the British laboratory. This joint venture which was named Galvenu Bioelectronics in honour of the Italian scientist Luidi Aloisio Galvani who discovered bioelectricity in the 18th Century during an experiment on frogs legs would benefit from funds of 640 million Euros over a period of seven years to finance the research, development and sales of treatments based on bioelectricity.

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The factors in favour of a rise in the GSK share price:

To anticipate the possible growth or future recession of the GSK group, it is necessary to know the stability and solidity of this company. This requires a good knowledge of the main strengths and weaknesses of this group, which we suggest you discover here in a little more detail.
Let us begin this comparative analysis by summarising the positive elements that the GlaxoSmithKline group has at its disposal to face the challenges of the future and therefore its main strengths:

  • One of the group's major strengths is of course its market positioning. Indeed, the GSK group is currently positioned among the 5 largest companies in the pharmaceutical sector. This gives it a certain weight in the market but also a certain strength with its customers and suppliers.
  • Another undeniable strength of this pharmaceutical group is its investment in research and development. GSK is currently one of the largest investors in R&D. It is also the largest investor in the pharmaceutical industry. It is also the largest private sector funder of research and development in the UK. This allows it to stay ahead of its competitors in terms of innovation.
  • The GSK group has received several awards for some of its qualities. For example, it has won the Manufacturing and Resource Efficiency Award in the chemical industry.
  • Still on the subject of GSK's main strengths, it is also possible to speak here of the strong diversification of the products developed by the group, which tends to enable it to explore new markets and thus generate additional profits in the future.
  • Also, GSK's strategy of international development and expansion of its activities has already enabled it to be present in more than a hundred countries at the present time and is continuing in order to reach even more.
  • Finally, the last strength that we can highlight about the GlaxoSmithKline group is its workforce, which currently consists of more than 97,000 people around the world.
The factors in favour of a drop in the GSK share price:

Of course, the GSK pharmaceutical group does not only have its strengths, but also some weaknesses that are important to know about, and here are some specific examples:

  • First of all, the group has suffered in the near past from certain controversies regarding the safety of some of its drugs. These events have strongly affected the company's brand image and still have negative repercussions today on consumer confidence in its products.
  • Finally, another undeniable weak point of this company concerns the competition, which is particularly strong and aggressive in this sector of activity.  This element is all the more important as the majority of the major patents currently held and exploited by GlaxoSmithKline will soon expire and will therefore be able to be exploited by competitors, which will result in a loss of earnings that will undoubtedly be difficult to make up with other products.

Of course, these are the current strengths and weaknesses of this company and its stock market value. But these points are likely to change over time and certain events or changes in and around the sector may add strengths or weaknesses in the future. It will also be necessary to take into account news and events that may reinforce them or make them null or less important. Finally, each advantage or disadvantage has its own weight and this should also be taken into account.
 

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Frequently Asked Questions

Who are the main shareholders of the GSK Group today?

The GSK Group's shareholder base is partly made up of a number of large institutional shareholders, including The Vanguard Group with 2.98% of the shares, BlackRock Investment Management with 2.59%, BlackRock Fund Advisors with 2.56%, Norges Bank Investment Management with 2. 45%, Legal & General Investment Management with 2.13%, Schroder Investment Management with 1.42%, Capital Research & Management with 1.37%, Dodge & Cox with 1.34%, Capital Research & Management with 1.28% and Thredneedle Asset management with 1.26%.

On which market is the GSK Group share listed?

Of course, as the GlaxoSmithKline Group is a UK-based company, its shares are listed on the London Stock Exchange or LES. But it is also listed on the US market as its shares are traded continuously and in real time on the New York Stock Exchange or NYSE in the US. This dual listing makes it a particularly popular asset.

What types of analysis can be carried out on GSK shares?

In order to analyse the GSK share price effectively, you should not be satisfied with a single analysis but rather carry out several in order to multiply the sources of different signals. Generally speaking, a technical analysis based on the study of stock market charts and a fundamental analysis based on external events and factors influencing the market are systematically carried out.
 

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