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Share Analysis Essay Example

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Share Analysis

However, the company has also reported that the operating profit for the second quarter of 2014 has slumped by 25% and the turnover decreased by 13%. The decrease in this company financials have affected the Earning per share (EPS), which have dropped by 25% from the previous year’s performance (Guardian News and Media Limited, “FTSE Ends Week On A company stated that there have been drastic changes in strategies of the company, which have affected its performance adversely instead of improving the situation in the first half of 2014. During the first half of 2014, GSK has to deal with Novartis pertaining to completion of a contract; to fulfil that contract GSK devised a number of strategies, which was not successful and ended up in reducing the turnover. The escalating competition in pharmaceutical market in the United States as well as worldwide has challenged the sales of the company. The sales of vaccines and pharmaceutical products had declined by 4%, which was the main cornerstone of the company. The decline of sales in Japan was 10%, which was one of the strongest markets in the whole world. The sales in European countries remained constant without much fluctuation.The turnover of new segment of GSK, Glaxo Consumer Healthcare, dropped by 4% due to the continuous interruption in supply of products in both Europe and the US (Al Jazeera America, LLC, However, the company has reported that the supply condition in these two countries is improving with the passage of time. Thus, sales in consumer healthcare section of the company are expected to remain flat in 2014. The company has announced that the opportunities in the pharma market are considerable enough to bring success to the company. It has outlined that there are 40 new molecular entities, which are at the last stage of development. These entities have the potential to get accepted by the medical board globally. This molecule has the ability to occupy first class in therapeutic areas like immune-inflammation, respiratory and cardiovascular.GSK reported that the repurchases of shares for the remaining period of 2014 remains immaterial, because of the impact of present decrease in value of Sterling on free cash flow. The above mentioned events have affected the share price of

Reference

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Damodaran, A. Investment valuation. (New Jersey: John Wiley & Sons, 2012).

GlaxoSmithKline plc., 2014a. Explore GSK. < http://www.gsk.com/explore-gsk.html >

GlaxoSmithKline plc., 2014b. Detailed Share Price. < http://www.gsk.com/investors/share-price-analysis/detailed-share-price.html >

Guardian News and Media Limited, 2014. FTSE Ends Week on a Low Note, While Glaxosmithkline Suggested As Pfizer Target. < http://www.theguardian.com/business/marketforceslive/2014/aug/01/ftse-falls-glaxosmithkline-suggested-pfizer-bid >

HeraldScotland, 2014. GSK Profits Warning Curbs FTSE 100 Rally. < http://www.heraldscotland.com/business/markets-economy/gsk-profits-warning-curbs-ftse-100-rally.24838753 >

Holmes, G., Sugden, A. & Gee, P. Interpreting Company Reports And Accounts. (New York: Prentice Hall, 2008).

MarketWatch, 2014a. Glaxosmithkline Lowers Full-Year Profit Outlook. < http://www.marketwatch.com/story/glaxosmithkline-lowers-full-year-profit-outlook-2014-07-23 >

MarketWatch, 2014b. Glaxo Slides In London After Earnings Warning. < http://www.marketwatch.com/story/uk-stocks-slip-ahead-of-boe-minutes-bhp-gains-2014-07-23 >

Petroff, A., 2013. Could China scandal derail Glaxo? < http://money.cnn.com/2013/07/17/investing/gsk-china-risks/ >

Roland, D., 2013. Chinese Police Accuse GSK Of Systemic Bribery. < http://www.telegraph.co.uk/finance/newsbysector/pharmaceuticalsandchemicals/10282547/Chinese-police-accuse-GSK-of-systemic-bribery.html >

The New Economy, 2014. GlaxoSmithKline bribery case now investigated in the UK. < http://www.theneweconomy.com/business/glaxosmithkline-bribery-case-now-investigated-in-the-uk >

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preview essay on Share Analysis
  • Pages: 8 (2000 words)
  • Document Type: Essay
  • Subject: Marketing
  • Level: Undergraduate
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