Haleon plc American Depositary Shares (Each representing two Ordinary Shares) (HLN)

FairStock Score: 50/100 — MIXED

Key Financials

Strengths

• Generates $1.4 billion in annual free cash flow (3.3% yield on market cap)
• Solid return on equity of 10.3% above cost of capital
• Attractive 2.0% dividend yield providing steady income returns
• Established organization with 24,535 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($5) with negative 109% margin of safety—limited downside protection

AI Analysis

Haleon plc American Depositary Shares (Each representing two Ordinary Shares) is a mid-cap healthcare company valued at $42.3 billion. Revenue stands at $11.0 billion. From a quality standpoint, Haleon shows Altman Z-Score of 2.9 in the grey zone and adequate 10% ROE. On valuation, the stock is reasonably priced at 19.1x earnings, with trades far above its Graham Number ($5) with no margin of safety. The 2.0% dividend yield adds an income component for patient holders. Our composite FairStock Score of 50/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $1.4 billion in annual free cash flow (3.3% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the healthcare space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer