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  • 1. A Presentation by David Brokate October 6, 2003
  • 2. Presentation Outline
    • Company Outline
    • Value of Holding
    • Company Snapshot
    • Current News an Information
    • Financial Statements
    • Stock Performance
    • Earnings and Net Income Estimates
    • Trend Analysis and Comparative Analysis
    • Ratio Analysis
    • Spreadsheet Model Valuations
    • Riskgrade Analysis
    • Analyst Recommendations
    • Conclusion
    • Recommendation
  • 3. Company Outline
    • Ticker: ABC
    • Sector: Healthcare
    • Industry: Drug Wholesale
    • Market: New York Stock Exchange
    • Market cap: $6154.50 (mil)
    • 52 week-high: $76.95
    • 52 week low: $45.65
    • Recent price: $56.71
    • Shares outstanding: 111.90 (mil)
  • 4. Value of Holding
    • Number of shares currently held: 50
    • Date shares were bought: 02/04/2002
    • Purchase price: $63.90
    • Total cost of purchase: $3195.00
    • Recent price/ share: $56.71
    • Market value of holding: $2835.50
  • 5. Company Snapshot
    • Business Description : Wholesale distributor of pharmaceutical products and related healthcare services and solutions, including pharmaceuticals, proprietary medicines, cosmetics, toiletries, personal health products, sundries and home healthcare supplies and equipment.
    • Location : Valley Forge, PA, USA
    • * Nation’s number 1 drug wholesaler
  • 6. Current News and Information
    • On January 6, 2003, Amerisource Bergen completed the purchase of Bridge Medical, Inc. which has the industry-leading bedside scanning capabilities.
    • On January 17, 2003, Amerisource Bergen acquired US Bioservices Corporation which is a national pharmaceutical services provider.
  • 7. Current News and Information (cont.)
    • On September 19, 2003, The Wall Street Journal reported that the Food and Drug Administration and the FBI were looking into allegations that Amerisource Bergen illegally diverted prescription drugs into a second market to boost profits.
    • The CEO, R. David Yost, acknowledged that a former employee had been engaged in misconduct a few years ago but was found quilty to mail fraud. He also acknowledged that a former customer participated in illegal actions in 2000.
    • R. David Yost guaranteed that an investigation would vindicate the company.
  • 8. Financial Statements
    • See Handouts
  • 9. Stock Performance (2 yrs)
  • 10. Stock Performance (1 yr)
  • 11. Stock Performance vs. competitors (1 yr)
  • 12. Earnings Estimate
  • 13. Net Income Estimate
  • 14. Trend Analysis: Income Statement
  • 15. Comparative Analysis: Income Statement
  • 16. Trend Analysis: Balance Sheet
  • 17. Comparative Analysis: Balance Sheet
  • 18. Ratio Analysis
  • 19. Ratio Analysis (cont.)
  • 20.  
  • 21.  
  • 22.  
  • 23. Summary of Valuations
    • Stock Value: Constant Growth Model - $75.48
    • Stock Value: Variable Growth Model - $13.59
    • Stock Value: Dividend & Earnings Model - $74.66
    • Stock Value: Price/Earnings Model - $83.74
    • Free Cash Flow - $87.55
    • Average Stock Value - $67.00
    • EVA and MVA - Firm is Creating Shareholder Wealth
  • 24. Risk Analysis
    • ABC’s risk grade is 137.
    • 71% of the tickers in the US Market are riskier than ABC.
  • 25. Analyst Recommendations
            • www.morningstar.com
            • Strong Buy - 11
            • Buy - 1
            • Hold - 1
            • Sell - 0
            • Strong Sell - 0 www.quicken.com
  • 26. Conclusion
    • New acquisitions could create a unique position to control the market.
    • The position of the nation’s #1 drug wholesaler going into an older generation era is promising.
    • Most of the stock valuations produced a higher stock value than the current stock price.
  • 27. Recommendation
    • Hold 50 shares of AmerisourceBergen