Current Analysis: Santen Pharmaceutical

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Santen Pharmaceutical Co Ltd (SNPHY) is a drug manufacturing company that focuses on ophthalmic products. The company reports two primary operating segments: prescription ophthalmic pharmaceuticals and others.

The pharmaceuticals segment includes over-the-counter pharmaceuticals, while the other segment includes medical devices. The vast majority of Santen's revenue is derived from its prescription ophthalmic pharmaceuticals segment, which manufactures and distributes prescription and OTC pharmaceuticals.

Most of Santen's sales are generated in Japan, followed by other Asian countries.

The company was founded in 1890 and is headquartered in Osaka, Japan.

Three key data points gauge

Santen Pharmaceutical Co Ltd or any dividend-paying firm.

The key three are:

(1) Price

(2) Dividends

(3) Returns

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

SNPHY Price

Over the past year, Santen's share price rose about 32% from $7.60 to $10.01 as of Thursday’s market close.

If SNPHY trades in the range of $6.00 to $14.00 this next year, its recent $10.01 share price might rise to $11.40 by next year. Of course, Santens price could drop about the same $1.39 estimated amount or more.

My annual upside estimate of $1.39 however, is about half the average annual price upside for SNPHY over the past year.

SNPHY Dividend

Santen has declared variable semi-annual dividends since October 2011. SNPHY’s most recent SA dividend of $0.11 was declared on September 6th to shareholders of record on September 28th. The payout was made on December 15th.

A forward-looking $0.22 annual dividend yields 2.20% at Thursday’s $10.01 share price.

SNPHY Returns

To put it all together, add Santen’s estimated annual dividend of $0.22 to the estimated price upside of $1.39 to find a $1.61 gross gain.

At Thursday’s $10.01 share price, a little over $1000 would buy 100 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, would cost us about $0.10 per share.

Subtracting that likely $0.10 brokerage cost from the $1.61 gross gain produces a net gain of $1.51 X 100 shares = $151.00 for a 15% estimated net gain.

You might choose to pounce on Santen Pharmaceutical Co Ltd. It is a 134-year-old dividend-paying Osaka-based ophthalmic pharmaceutical company.

Furthermore, the estimated $22.00 of annual dividend income from $1k invested is about 2 times greater than SNPHY’s recent $10.01 single share price.

The exact track of Santen’s ongoing future price and dividend will be determined by market action.

Remember the true value of any stock is best realized through personal ownership of shares.


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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 solicitation, ...

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