WST Stock Up on Q3 Earnings Beat, EPS View Raised on Demand & FX Benefit

Core Insights - West Pharmaceutical Services, Inc. (WST) reported adjusted third-quarter 2025 earnings per share (EPS) of $1.96, a 5.9% increase year over year, exceeding the Zacks Consensus Estimate by 17.4% [1][6] - Quarterly revenues reached $804.6 million, up 7.7% year over year, surpassing the Zacks Consensus Estimate by 2.4% [2][6] - The company raised its full-year EPS guidance to $7.06-$7.11, citing strong demand and favorable foreign exchange impacts [6][15] Revenue Breakdown - Proprietary Products segment generated revenues of $647.5 million, reflecting a 7.7% year-over-year increase, with organic growth of 5.1% [5][7] - High-Value Product (HVP) components accounted for 48% of net sales, with a notable 16.3% growth, while HVP Delivery Devices saw a decline of 15.7% [7][8] - Contract-Manufactured Products segment revenues totaled $157.1 million, up 8% year over year, driven by self-injection devices for obesity and diabetes [8] Margin and Expense Analysis - Gross profit increased by 11.2% year over year to $294.3 million, with a gross margin expansion of 120 basis points to 36.6% [9] - Selling, general and administrative expenses rose 23% year over year to $102.7 million, while research and development expenses increased by 10.3% to $17.1 million [9] Financial Position - The company ended the third quarter with cash and cash equivalents of $628.5 million, up from $509.7 million at the end of June [11] - Total debt remained stable at $202.7 million, with cumulative net cash from operating activities increasing to $503.7 million compared to $463.3 million a year ago [11] Guidance and Outlook - For the fourth quarter, WST expects sales between $790 million and $800 million, indicating organic growth of 1-2.3% [13] - Full-year revenue guidance has been raised to $3.06 billion to $3.07 billion, with organic net sales expected to grow by 3.75-4% [14] - Adjusted EPS for the full year is now anticipated to be in the range of $7.06-$7.11, reflecting a 27 cents benefit from currency movements [15] Strategic Focus - The company’s strong quarterly performance highlights the resilience of its diversified portfolio and effective execution across both Proprietary and Contract Manufacturing segments [17][18] - Continued focus on innovation, quality, and customer partnerships strengthens its competitive position in the injectable solutions market [19]