Lonza Group (SWX:LONN) has attracted fresh attention after reporting first half 2026 results alongside new guidance, combining higher sales and earnings with an increased core EBITDA margin outlook and portfolio reshaping moves.
See our latest analysis for Lonza Group.
Over the past year Lonza Group’s share price return has been mixed, with a 14.21% 90 day gain and a 3.71% 30 day rise contrasting with a 2.34% decline in 1 year total shareholder return. This points to improving short term momentum after a tougher period for longer term holders.
If you are reassessing Lonza Group after its latest guidance and want to widen the opportunity set in healthcare and biotech related themes, it could be worth scanning 128 healthcare AI stocks
For Lonza Group, the recent rebound sits between two stories: stronger reported earnings and margin guidance on one side, and changing sentiment after a weak 1-year return on the other, which puts the current valuation into sharper focus.
Price-to-Earnings of 35.4x: Is it justified?
On a P/E of 35.4x at a last close of CHF548, Lonza Group trades at a level that aligns with, and in some areas sits below, key reference points in its sector.
The P/E multiple reflects how much investors are currently paying for each unit of Lonza Group's earnings, a common yardstick for profitable pharma and biotech contract manufacturers. Given that earnings are forecast to grow 17.21% per year and have recently accelerated, a higher earnings multiple can often indicate the market is willing to pay up for that expected growth profile.
Against the Global Life Sciences industry average P/E of 36.6x and a peer average of 54.1x, Lonza Group's 35.4x sits at a discount, suggesting the stock is not priced at a premium relative to similar companies. Compared with an estimated fair P/E of 36.7x, the current level is also slightly below the regression based reference point, which some investors may view as a level the market could gravitate toward if earnings delivery remains consistent.
Explore the SWS fair ratio for Lonza Group
Result: Price-to-Earnings of 35.4x (ABOUT RIGHT)
However, Lonza Group’s weaker 1 year and 5 year total returns and its relatively high P/E still leave room for sentiment setbacks if earnings delivery disappoints.
Find out about the key risks to this Lonza Group narrative.
Another View: DCF sends a different message on Lonza Group
While Lonza Group looks reasonably priced on a 35.4x P/E, the SWS DCF model paints a tougher picture, with the stock at CHF548 compared with a future cash flow value estimate of CHF382.93. That implies Lonza Group could be trading above its cash flow based fair value, raising the question of which signal should carry more weight.
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Lonza Group for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 247 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
Given the mix of optimism and caution around Lonza Group, it makes sense to review the data yourself and decide where you stand. To help frame that view quickly, take a look at the 4 key rewards and 1 important warning sign.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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