Last Update 07 May 26
Fair value Decreased 8.36%Reig Jofre Will Emerge Stronger Despite Temporary Setbacks
After reviewing Reig Jofre’s latest annual report and the Q1 2026 results, we are updating our 3-year fair value estimate to €3.29 per share, down from our previous €3.59 target published six months ago. The revision does not reflect a deterioration of the long-term business case, but rather a more realistic assessment of the pace of execution and margin recovery.
The investment thesis remains intact. Reig Jofre is still transitioning from a traditional mid-sized pharmaceutical manufacturer toward a higher value-added model focused on injectable products, specialty therapeutics and biotech/CDMO capabilities through Leanbio and Syna. However, the transformation is proving slower and more capital intensive than initially expected.
2025 represented a clear operational trough, mainly caused by the temporary disruption in antibiotic production at the Toledo plant, weaker pharmaceutical technologies sales and pressure on profitability during the investment cycle. Importantly, the latest results confirm that these issues are operational rather than structural. Gross margin remains resilient around 60%, Specialty Pharmacare is growing strongly again, and EBITDA stabilization has already started to emerge in early 2026.
Nevertheless, we now expect the recovery curve to be more gradual. The market is no longer questioning whether the company can recover, but rather how quickly margins can normalize and new strategic investments can translate into earnings growth. In our view, this justifies a more conservative central valuation range despite maintaining a constructive long-term outlook.
Our updated €3.29 fair value is based on a normalized EBITDA recovery scenario in the €40–42 million range over the next three years, applying moderate sector multiples that reflect both execution risk and the improving quality of the business mix. At current levels, we still believe Reig Jofre offers attractive upside potential, supported by industrial normalization, improving operational leverage and long-term optionality linked to its biotech platform.
- Situación financiera sólida: Patrimonio neto > 60% del balance, deuda controlada.
- Beneficio coyunturalmente bajo: impacto no estructural.
- Recuperación esperada: mayor contribución de divisiones biotecnológicas y fin de la parada industrial.
- Valoración fundamental: el valor intrínseco (4,82 €) se mantiene vigente, respaldado por estructura patrimonial estable.
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The user Janpeo holds no position in BME:RJF. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.