Jean Hynes of the Vanguard Health Care Fund (Trades, Portfolio) added 320,542 shares of Chugai Pharmaceutical (TSE:4519) at an average price of 3,658.41 Japanese yen ($36.51) during the second quarter.
The trade had a 0.02% impact on the portfolio. Vanguard now owns 13,459,942 shares in the company.
Chugai Pharmaceutical is a pharmaceutical company that manufactures, sells, imports and exports pharmaceutical products. It develops products in the areas of oncology, bone and joint diseases, autoimmune diseases, central nervous systems and other diseases.
The company began operations in 1925, two years after the Great KantŠearthquake took thousands of lives. This tragedy inspired Juzo Ueno, Chugai Pharmaceutical's founder, to develop drugs “that benefit the world.”
The company had to deal with tremendous adversity during World War II after its headquarters and two of its plants located in Ikebukuro and Sakai burned down. Its Takada plant was also damaged.
Chugai was able to rebuild these plants in different locations, and it attributed two of its products Guronsan, and Varsan to helping Chugai recover from the setbacks it faced. After World War II, Chugai was able to recoveed and expanded its operations, broadening its pipeline of products used to treat various diseases.
Chugai Pharmaceutical has a price-book (P/B) ratio of 2.84, a price-sales (P/S) ratio of 3.53, a current ratio of 5.00 and a quick ratio of 3.40.
According to GuruFocus, Chugai Pharmaceutical has a 9 of 10 financial rating with an equity to asset ratio of 0.82, a stable Piotroski F-Score of 6, and an Altman Z-Score of 10.64 indicating that the company is in the safe zone and is not in danger of filing for bankruptcy in the near future. The company also has a 7 of 10 profitability and growth rating with an operating margin of 17.20, a net-margin of 12.35% and an ROA of 8.11% ranking it above 72% of the 773 companies in the global drug manufacturers industry.
Chugai Pharmaceutical has 91 years of operating experience, and it has been able to successfully overcome tremendous setbacks throughout the course of its history. The company has good financial strength, a broad portfolio of products, and its dividend yield is close to its 2 year high. These factors likely had an impact on Jean Hynes decision to add 320,542 shares of Chugai Pharmaceutical to the Vanguard portfolio during the second quarter.
Below is a Peter Lynch chart that shows Chugai Pharmaceutical is trading above its intrinsic value
Cheers to your investment success.
Disclosure: Author does not own any shares of this company.
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