Daily Stock Analysis: Sanofi S.A.

By Fredrik Arnold

Tuesday, July 19, 2022 3:00 AM EDT

Sanofi SA, with the ticker SNY, is a large-cap general drug manufacturer operating in the healthcare business sector. This is the second of five consumer cyclical candidates competing for the forty-second slot in the Viital folio. It is my first report on Sanofi SA for my Viital portfolio. I have selected SNY for one one my previous six portfolios.

Sanofi develops and markets drugs with a concentration in oncology, immunology, cardiovascular disease, diabetes, and vaccines.

However, the company's decision in late 2019 to pull back from the cardio-metabolic area will likely reduce the firm's footprint in this large therapeutic area.

The company offers a diverse array of drugs with its highest revenue generator, Dupixent, representing just over 10% of total sales, but profits are shared with Regeneron. About 30% of total revenue comes from the United States and 25% from Europe. Emerging markets represent the majority of the remainder of revenue.

The company was formerly known as Sanofi-Aventis and changed its name to Sanofi in May 2011. Sanofi was founded in 1973 and is headquartered in Paris, France.

Three key data points gauge any dividend equity or fund such as Sanofi SA.

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.

SNY Price

Sanofi’s price per share was $50.13 as of yesterday's market close. One year ago its price was $51.15. Thus, SNY’s share price fell $1.02 or about 2% in the past year.

If Sanofi’s stock trades in the range of $45.00 to $60.00 this next year, its recent $50.13 share price might rise by $7.87 to reach $58.00 by next year. My $7.87 upside estimate is based on the median of one year price estimates from five analysts covering SNY. Theirs however is $7.20 higher,

SNY Dividends

Sanofi’s most recently declared dividend of $0.30 was paid June 27th, to shareholders on record as of May 26th.

Since June 5, 2014, SNY has paid annual dividends. The current forward looking annual dividend of $1.73 equates to an annual yield of 3.46% as of yesterdays $50.62 share price.

SNY Returns

Adding the $1.73 Sanofi SA annual forward-looking dividend to my estimated one-year price upside estimate of $7.87 shows a $9.60 potential gross gain, per share, to be reduced by any costs to trade SNY shares.

At yesterday's $50.13 closing price, a little over $1000 would buy 20 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at sale and might cost us about $0.50 per share.

Subtract that maybe $0.50 brokerage cost from my estimated $9.60 gross gain estimate per share results in a net gain of $9.10 X 20 shares = $182.00. for a 18.2% net gain including a 3.46% forward looking annual dividend yield.

Over the next year our $1K investment in Sanofi SA shares should generate $34.60 in cash dividends. Of course, a single share of SNY stock bought at yesterday's $50.13 price is over $15 greater than the dividend income from our $1000.00 investment.

So, by my dogcatcher ideal, this an awful time to pick up SNY shares based on their forward looking dividends for the year 2022. The forthcoming annual dividend from $1K invested is $15.53 less than yesterday’s single share price. Consider yourself alerted. It's a sign. Hold off on Sanfofi AG until the share price drops to $41.60.

All of the estimates above are speculation based on the past history of Sanofi SA. Only time and money invested in this stock will determine its market value.

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Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...

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