Core Viewpoint - Grifols (GRFS) has faced significant selling pressure, resulting in a 10.4% decline over the past four weeks, but analysts anticipate improved earnings in the near future [1] Group 1: Technical Indicators - The Relative Strength Index (RSI) is utilized to determine if a stock is oversold, with a reading below 30 indicating oversold conditions [2] - GRFS has an RSI reading of 28.86, suggesting that the heavy selling may be nearing exhaustion, potentially leading to a price rebound [5] Group 2: Fundamental Indicators - Analysts have raised earnings estimates for GRFS by 0.5% over the last 30 days, indicating a positive trend that typically correlates with price appreciation [7] - GRFS holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, further supporting the potential for a turnaround [8]

Core Insights - Grifols is a significant player in the medical sector, focusing on plasma-derived medicines and healthcare products, operating among 954 peers and ranked 5 in the Zacks Sector Rank [1] Financial Performance - On November 4, 2025, Grifols reported an earnings per share (EPS) of $0.24, meeting market expectations, with revenue of approximately $2.14 billion, slightly below the estimated $2.15 billion [2][6] - The company holds a Zacks Rank of 2 (Buy), indicating potential to outperform the broader market [2][6] Financial Metrics - Grifols has a price-to-earnings (P/E) ratio of 18.58, a price-to-sales ratio of 0.91, and an enterprise value to sales ratio of 2.02, suggesting attractive pricing relative to sales [3] - The enterprise value to operating cash flow ratio is 13.62, and the earnings yield is 5.38%, indicating strong cash flow generation and return on investment [4] - The debt-to-equity ratio stands at 1.71, reflecting financial leverage, while the current ratio is 2.64, demonstrating the ability to cover short-term liabilities [4] Competitive Positioning - Grifols' year-to-date performance is noteworthy compared to peers like Arcutis Biotherapeutics, Inc. (ARQT), suggesting strong potential for growth and stability in the competitive medical sector [5]

Financial Data and Key Metrics Changes - Year-to-date revenue reached €5.5 billion, reflecting a year-over-year increase of 7.7% and 10.5% like-for-like after adjustments [5][26] - Adjusted EBITDA for Q3 was €482 million, contributing to a year-to-date adjusted EBITDA of €1.358 billion, up 11.2% and 17.3% like-for-like [6][29] - Free cash flow pre-M&A and pre-dividends improved to €188 million year-to-date, marking a significant €257 million year-over-year improvement [7][35] - The leverage ratio at the end of Q3 was 4.2 times, showing nearly one-time improvement over the prior year [7][27] Business Line Data and Key Metrics Changes - The biopharma portfolio grew by 10.9% in Q3, with Immunoglobulins franchise leading at 18% growth for the quarter [11][12] - Albumin volumes contracted by 4.5% in Q3 due to pricing pressure in China, with a year-to-date contraction of 3.9% [12] - Alpha-1 and specialty proteins franchises saw revenue growth of 3.3% in Q3, bringing year-to-date growth to 4.3% [13] Market Data and Key Metrics Changes - The U.S. market for Immunoglobulins showed strong growth, with Xembify growing over 60% in the last 12 months [16] - The market for albumin in China faced challenges due to government-imposed cost controls, impacting pricing and demand [12][52] Company Strategy and Development Direction - The Value Creation Plan focuses on commercial growth, margin expansion, and pipeline execution, with a strong emphasis on operational leverage and optimized plasma sourcing [8][10] - The company aims to launch fibrinogen in Europe by the end of 2025, with a U.S. launch planned for the first half of 2026 [9][21] - Innovation remains a cornerstone, with ongoing advancements in product formulations and new therapeutic areas [20][24] Management's Comments on Operating Environment and Future Outlook - The management acknowledged a complex external environment but expressed confidence in the company's ability to navigate challenges [4][5] - The company reaffirmed its full-year 2025 revenue and adjusted EBITDA guidance, despite external pressures [43][42] Other Important Information - The company is actively managing the impact of the Inflation Reduction Act and foreign exchange headwinds, with a focus on maintaining financial discipline [3][30] - The company is committed to strengthening its balance sheet and capital allocation priorities to create long-term value [8][43] Q&A Session Questions and Answers Question: Clarification on the delay of fibrinogen and AFD in the U.S. - Management indicated that the delay is due to the need for more solid clinical data to support the standard of care change in the U.S. market [46][47] Question: Dynamics of albumin in China - The pricing pressure in China is primarily driven by government-imposed cost controls affecting both prices and demand [51][52] Question: Clarification on EBITDA guidance for the year - Management explained that the guidance reflects a robust Q4 expectation, despite a tough comparison to Q4 2024 due to phasing [54][56]

Financial Performance - YTD Q3 2025 Revenue reached €5542 million, a 77% increase at constant currency[11] - YTD Q3 2025 Adjusted EBITDA grew to €1358 million, an 112% increase at constant currency[11] - YTD Q3 2025 Free Cash Flow (pre-M&A) was €188 million, an increase of €257 million[11] - The company's leverage ratio decreased to 42x compared to the previous year[11] - Q3 2025 Net Revenue was €18654 million, a 40% increase[75] - YTD Group Profit reached €304 million, a 2454% increase[40] Business Segment Performance - Biopharma revenue increased by 91% YTD at constant currency, and 109% in Q3[45, 17] - IG (Immunoglobulin) franchise is a key driver of Biopharma growth, with overall growth ahead of the market[17] - Alpha-1 and specialty proteins also contributed to the growth of Biopharma[45] - Diagnostic revenue increased by 14% YTD at constant currency[45] Future Outlook - The company improved its revenue guidance for FY25 to €7600+ million at guidance FX rate[63] - The company improved its FCF pre-M&A pre-dividends guidance for FY25 to €400-425 million[63]

Core Insights - Grifols (GRFS) is currently outperforming its peers in the Medical group, with a year-to-date gain of approximately 26.2% compared to the average gain of 4% for Medical stocks [4] - The Zacks Rank system indicates a positive outlook for Grifols, currently holding a Zacks Rank of 2 (Buy), with a 1% increase in the consensus earnings estimate over the past 90 days [3] Company Performance - Grifols is part of the Medical - Drugs industry, which consists of 145 companies and is ranked 90 in the Zacks Industry Rank, with an average gain of 7.3% year-to-date [5] - The stock's performance is significantly better than the industry average, indicating strong relative strength within its sector [5] Comparison with Peers - Arcutis Biotherapeutics, Inc. (ARQT) is another standout in the Medical sector, having returned 81.6% year-to-date, with a Zacks Rank of 1 (Strong Buy) and a 19.9% increase in the consensus EPS estimate over the past three months [4][5] - The Medical group is currently ranked 5 within the Zacks Sector Rank, which evaluates the strength of 16 different groups based on the average Zacks Rank of individual stocks [2]

Core Insights - Investors in the Medical - Drugs sector should consider Grifols (GRFS) and Zoetis (ZTS) for potential value opportunities [1] Group 1: Zacks Rank and Value Assessment - Grifols has a Zacks Rank of 2 (Buy), indicating a strong earnings estimate revision trend, while Zoetis has a Zacks Rank of 3 (Hold) [3] - Value investors analyze a range of traditional figures and metrics to assess whether a company is undervalued at its current share price levels [3][4] Group 2: Valuation Metrics - GRFS has a forward P/E ratio of 9.23, significantly lower than ZTS's forward P/E of 22.99 [5] - GRFS's PEG ratio is 0.32, while ZTS's PEG ratio is 2.35, indicating GRFS may offer better value based on expected EPS growth [5] - GRFS has a P/B ratio of 0.75 compared to ZTS's P/B of 13.02, further supporting GRFS's superior valuation metrics [6] Group 3: Overall Value Proposition - Grifols stands out due to its solid earnings outlook and favorable valuation figures, making it the superior value option compared to Zoetis [7]

Core Viewpoint - Investors in the Medical - Drugs sector should consider Grifols (GRFS) and Stevanato Group (STVN) for potential value opportunities, with GRFS currently appearing to offer better value based on various metrics [1]. Valuation Metrics - Grifols has a Zacks Rank of 2 (Buy), indicating a more favorable earnings estimate revision activity compared to Stevanato Group, which has a Zacks Rank of 3 (Hold) [3]. - GRFS has a forward P/E ratio of 9.26, significantly lower than STVN's forward P/E of 41.82, suggesting GRFS may be undervalued [5]. - The PEG ratio for GRFS is 0.32, while STVN's PEG ratio is 2.38, indicating that GRFS has a better valuation relative to its expected earnings growth [5]. - GRFS's P/B ratio is 0.76, compared to STVN's P/B of 4.65, further supporting the notion that GRFS is more attractively valued [6]. Conclusion - Overall, GRFS exhibits stronger estimate revision activity and more appealing valuation metrics than STVN, leading to the conclusion that GRFS is the superior option for value investors at this time [7].

Core Points - Spain's High Court has summoned Daniel Yu, the founder of Gotham City Research, to testify regarding allegations of disseminating misleading information about pharmaceutical companies [1] Group 1 - The High Court's action indicates a legal response to concerns over the impact of short-selling activities on the pharmaceutical sector [1] - The case highlights the ongoing scrutiny of short sellers and their influence on market perceptions of companies [1] - Allegations against Gotham City Research suggest potential regulatory implications for short-selling practices in the industry [1]

Group 1 - The article expresses a beneficial long position in the shares of GRFS, indicating a positive outlook on the company's stock performance [1] - The author emphasizes the importance of conducting due diligence and research before making any investment decisions, highlighting the need for investors to understand their risk tolerance [2] - The article clarifies that past performance is not indicative of future results, and no specific investment recommendations are provided [3]

Company Overview - Grifols, S.A. is a global healthcare company headquartered in Barcelona, specializing in plasma-derived therapies, diagnostics, and hospital supplies, with a strong presence in over 100 countries [2]. Business Units and Focus Areas - The company's main business units include Bioscience, Diagnostics, and Hospital, focusing on immunotherapy, transfusion medicine, and critical care, addressing treatments for bleeding disorders, immunodeficiencies, and neurological conditions [2]. Expansion Plans - In mid-2025, Grifols announced plans to build a new manufacturing site in Spain, aimed at doubling its plasma fractionation capacity in Europe, reflecting a strategic commitment to meet rising demand for plasma-based therapies [3]. Financial Performance - Grifols reported a 7% increase in revenue to EUR 3,677 million in H1 2025, supported by its Value Creation Plan [3]. Market Positioning - The new facility in Spain is expected to strengthen Grifols' supply chain resilience and enhance its competitive position in the growing plasma therapeutics market, aiming to improve market share while addressing critical clinical needs [4].