Q: Can you comment on the balance sheet strength (or lack of) and outlook of these 2 companies and whether you would be a buyer or seller of the securities. Thanks!!
5i Research Answer:
Please see this answer from this week on PFE. It has $7B cash and $69.4B in debt as of June 30. Operating cash flow (12 months) was $8B. It is quite leveraged.
MX has $426M cash and $3B debt, against $389M in 12-month operating cash flow. At 6X debt/cf, it is also quite leveraged. It is a cyclical business, but consensus calls for very strong earnings growth in 2025. At 15X earnings we would be ok buying a small position, but buyers need to be optimistic on the global economy here.