West Pharmaceutical Defies Doubters: EPS Jumps, Outlook Raised Despite Tariff Drag – West Pharmaceutical Servs (NYSE:WST)

West Pharmaceutical Services, Inc. WST on Thursday reported first-quarter 2025 adjusted EPS of $1.45, beating the consensus of $1.23.

The injectable pharmaceutical packaging and delivery systems company reported sales of $698 million, beating the consensus of $685.84 million.

Net sales grew by 0.6%. Organic net sales growth was 2.4%.

The Proprietary Products Segment’s sales increased by 0.6% to $563.0 million, and organic net sales growth was 2.4%.

High-value products (components and devices) represented around 73% of segment net sales, led by customer demand for self-injection device platforms partially offset by lower sales of FluroTec products.

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The Biologics market unit had mid-single-digit organic net sales growth, driven primarily by an increase in sales of self-injection device platforms partially offset by lower sales of FluroTec products.
The Pharma market unit saw mid-single-digit organic net sales growth, driven by increased sales of standard and Westar products.
The Generics market unit had a mid-single-digit decline in organic net sales, driven by a decline in sales of standard and FluroTec products.

Contract-Manufactured Products Segment net sales declined by 0.7% to $135.0 million, while organic net sales grew by 0.8%. Segment performance was driven by an increase in sales in self-injection devices for obesity and diabetes, partially offset by a decrease in sales of healthcare diagnostic devices.

On Thursday, West Pharmaceutical said Bernard Birkett, senior vice president and CFO, will step down this year. West has commenced a search for a successor.

Guidance: West Pharmaceutical Services raised the 2025 adjusted EPS guidance from $6.00-$6.20 to $6.15-$6.35 compared to the consensus of $6.14.

The company raised sales guidance from $2.88 billion-$2.91 billion to $2.94 billion-$2.98 billion vs $2.9 billion.

Organic net sales growth is expected to be approximately 2% to 3%.
The company said updated adjusted-diluted EPS guidance incorporates our estimate of $20 to $25 million for the net impact of recently implemented tariffs for the remainder of 2025.

William Blair analyst Matt Larew writes, “It appears West has taken proactive measures to address the problems that arose last quarter…”

Larew writes that while the increase is primarily due to foreign exchange effects, the solid results are a positive surprise after last quarter’s weaker outlook, which caused a drop in the stock.

The core business shows signs that inventory issues are improving, demand hasn’t worsened, and contract manufacturing has grown slightly more than expected.

William Blair maintains the Outperform rating.

Price Action: WST stock was down 3.4% at $210.59 on Thursday.

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