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what it is
Perrigo makes the store-brand health products you grab at Walmart, from cough meds to infant formula.
how it gets paid
Last year Perrigo made $4.3B in revenue. Store-brand OTC Americas was the main engine at $2.55B, or 59% of sales.
why growth slowed
Revenue fell 2.8% last year. Gross margin was 36.0%, but weak OTC consumption, sluggish infant formula demand, and restructuring friction kept profits under pressure.
what just happened
Revenue was $3.1B, but EPS landed at -$0.05 and the last reported quarter also missed consensus.
At a glance
B+ balance sheet — decent shape, but not bulletproof
70/100 earnings predictability — reasonably predictable
4.6x trailing p/e — the market's not buying it — or you found a deal
4.7% dividend yield — cash in your pocket every quarter
8.0% return on capital — nothing to write home about
xvary composite: 56/100 — below average
What they do
Perrigo makes the store-brand health products you grab at Walmart, from cough meds to infant formula.
Perrigo wins where shoppers barely look. You buy the cheaper store-brand cold medicine, allergy pill, or baby formula, and Perrigo supplies it at scale. Walmart was 11.9% of 2024 sales, and Perrigo sells thousands of OTC products, which means shelf space and retailer relationships matter more than flashy branding.
How they make money
$4.3B
annual revenue · their business grew -2.8% last year
Store-brand OTC Americas
$2.55B
4.0%
Infant formula & nutrition
$0.55B
8.0%
Consumer self-care international
$1.00B
1.0%
Animal health & other
$0.20B
0.0%
The products that matter
private-label consumer health
Store-Brand OTC
core to the $4.3B revenue base
this is the center of the $4.3B business. the pitch to retailers is simple: offer the cheaper box and keep the shelf full.
core revenue
infant nutrition
Infant Formula
called out in the recent slowdown
management singled this category out when third-quarter sales fell 4% from a year ago. that makes infant formula a bigger swing factor than its shelf space suggests.
demand watch
adjacent self-care categories
Animal Health and Other Self-Care
part of a 9.8% margin mix
these lines widen the assortment, but a business keeping 9.8 cents of every revenue dollar still lives or dies on execution in the core categories.
supporting mix
Key numbers
4.6x
trailing p/e
P/E → price-to-earnings → what you pay for each dollar of profit. You are paying 4.6 times earnings for a company expected to do $3.00 EPS in 2026.
26.4%
operating margin
Operating margin → profit after running the business → the core operation is losing money even before you get to valuation arguments.
$3.6B
long-term debt
Long-term debt → money owed over many years → Perrigo carries debt worth about 1.8 times its ~$2B market cap.
4.7%
dividend yield
Dividend yield → cash paid back to shareholders each year → you are getting paid to wait, but the projected dividend growth rate is -9.5%.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 45 / 100
- long-term debt $3.6B (67% of capital)
- net profit margin 10.9% — keeps 11 cents of every dollar in revenue
- return on equity 12% — $0.12 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in PRGO 3 years ago → it's now worth $4,600.
The index would have given you $13,920.
source: institutional data · total return
What just happened
missed estimates
Revenue was $3.1B, but EPS landed at -$0.05 and the last reported quarter also missed consensus.
Gross margin was 36.0%, but weak OTC consumption, sluggish infant formula demand, and restructuring friction kept profits under pressure. The last earnings report came in at $0.79 versus a $0.83 estimate, a 4.82% miss.
$1.1B
revenue
$0.05
eps
36.0%
gross margin
the number that mattered
The key number was the 4.82% earnings miss, because cheap stocks usually stay cheap when management keeps coming in below expectations.
-
perrigo stock has tumbled some 40% in value over the past three months, largely on weak quarterly results and lower expectations for the year soon ending.
-
third-quarter sales fell more than expected at 4%, vs. prior year, while adjusted share earnings slipped by a penny, but still beat estimates by $0.05.
-
softer otc consumption levels, against a difficult backdrop, and sluggishness in the infant formula line were mostly to blame for the decline in organic sales, despite market-share gains in key categories and brands.
-
while restructuring-related cost savings contributed, the bottom line still fell short.
-
also disappointing was perrigo’s reduced view for 2025.
source: company earnings report, 2026
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What could go wrong
the #1 risk is continued weakness in store-brand OTC and infant formula demand.
med
core demand does not recover
Third-quarter sales fell 4% from a year ago, and management tied the decline to softer OTC consumption and sluggish infant formula demand. If those shelves stay slow, the recovery case loses its main support.
This pressure hits the full $4.3B revenue base the market is already discounting.
med
$3.6B of debt narrows the margin for error
Long-term debt equals 67% of capital. That is manageable in a steady business. It feels tighter when the stock has already dropped from $31 to $12 and revenue is slipping.
If operating results disappoint again, balance-sheet flexibility becomes part of the thesis whether you want it to or not.
med
the low-price model leaves little pricing power
There is no patent moat here. Perrigo wins with price, retailer relationships, and execution. That works until margin pressure starts eating the spread.
At 6.5% return on capital, even a modest squeeze matters more than it would in a higher-return business.
If weakness lingers, it pressures a $4.3B revenue base carrying $3.6B in long-term debt and supporting a 4.7% dividend.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
whether revenue can hold near $4B
Last year printed $4.3B, while the forward view sits closer to $4B. That gap is the cleanest scoreboard for whether the business is stabilizing or still shrinking.
risk
debt relative to earnings
$3.6B in long-term debt is manageable only if the earnings base stops slipping. If EPS wobbles again, the low multiple starts looking earned.
trend
whether the stock or the target gap closes first
The stock is at $12.84 while the 3–5 year midpoint target sits at $21. Watch whether the business improves enough for the stock to move up, or the target needs to move down.
calendar
the next guide after $2.80 full-year EPS
One quarter at $0.83 EPS helped. The next real test is whether management can defend the path toward the $3.00 estimate without another reset.
Analyst rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts are not seeing a clean short-term edge yet.
risk profile
average
stability score 3 — about middle of the pack on risk. not especially safe, not chaos either.
chart momentum
average
technical score 3 — the chart is not giving you a rescue signal yet.
earnings predictability
70 / 100
reasonable visibility, but recent guide cuts are a reminder that predictable is not the same as durable.
source: institutional data
Institutional activity
157 buyers vs. 177 sellers in 3q2025. total institutional holdings: 0.1B shares.
source: institutional data
Price targets
3-5 year target range
$11
$30
$13
current price
$21
target midpoint · +64% from current · 3-5yr high: $30 (+135% · 26% ann'l return)
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