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Sanofi (NAS:SNY) Financial Strength

: 7 (As of Dec. 2022)
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Sanofi has the Financial Strength Rank of 7.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Sanofi's Interest Coverage for the quarter that ended in Dec. 2022 was 24.78. Sanofi's debt to revenue ratio for the quarter that ended in Dec. 2022 was 0.43. As of today, Sanofi's Altman Z-Score is 2.04.


Competitive Comparison

For the Drug Manufacturers - General subindustry, Sanofi's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Sanofi Financial Strength Distribution

For the Drug Manufacturers industry and Healthcare sector, Sanofi's Financial Strength distribution charts can be found below:

* The bar in red indicates where Sanofi's Financial Strength falls in comparison to its industry or sector. The grey bar indicates the Financial Strength's extreme value range as defined by GuruFocus.



Sanofi Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Sanofi's Interest Expense for the months ended in Dec. 2022 was $-300 Mil. Its Operating Income for the months ended in Dec. 2022 was $7,430 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2022 was $17,755 Mil.

Sanofi's Interest Coverage for the quarter that ended in Dec. 2022 is

Interest Coverage=-1*Operating Income (Q: Dec. 2022 )/Interest Expense (Q: Dec. 2022 )
=-1*7430.0847457627/-299.78813559322
=24.78

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Sanofi's Debt to Revenue Ratio for the quarter that ended in Dec. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(4715.0423728814 + 17755.296610169) / 52105.93220339
=0.43

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Sanofi has a Z-score of 2.04, indicating it is in Grey Zones. This implies that Sanofi is in some kind of financial stress. If it is below 1.81, the company may faces bankrupcy risk.

Warning Sign:

Altman Z-score of 2.04 is in the grey area. This implies that the company is under some kind of financial stress. If it is below 1.8, the company may face bankruptcy risk.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Sanofi  (NAS:SNY) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Sanofi has the Financial Strength Rank of 7.


Sanofi Financial Strength Related Terms

Thank you for viewing the detailed overview of Sanofi's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Sanofi (NAS:SNY) Business Description

Sanofi logo
Address
54, Rue La Boetie, Paris, FRA, 75008
Sanofi develops and markets drugs with a concentration in oncology, immunology, cardiovascular disease, diabetes, and vaccines. However, the company's decision in late 2019 to pull back from the cardio-metabolic area will likely reduce the firm's footprint in this large therapeutic area. The company offers a diverse array of drugs with its highest revenue generator, Dupixent, representing just over 10% of total sales, but profits are shared with Regeneron. About 30% of total revenue comes from the United States and 25% from Europe. Emerging markets represent the majority of the remainder of revenue.

Sanofi (NAS:SNY) Headlines

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