Reiterating his bullish case for Dr. Reddy's Laboratories, Ltd. (RDY), Zacks senior healthcare analyst Jason Napodano, CFA explains why the shares of the pharmaceutical company are a good Buy:
'Dr. Reddy's Laboratories, Ltd. is a global pharmaceutical company located in Hyderabad, India. RDY produces active pharmaceutical ingredients (API), finished dosage forms, and branded and generic pharmaceutical products for the global market. The company has a healthy pipeline and is an active participant in terms of international product filings. During fiscal 2007, RDY experienced both top-line and bottom-line growth thanks to many products going off-patent over the past several months.
'RDY currently has 69 ANDAs filed with the U.S. FDA, which should present future growth opportunities for the company. We maintain our Buy recommendation with a target of $19. We upgraded the stock to a Buy in early August 2005.
'We are also pleased with the company's efforts to cut down costs by entering into strategic alliances for the development of certain pipeline candidates. The company's shares are presently trading at approximately 14x our fiscal year 2008 EPADS estimate of $1.10. Our target price of $19 is based on a forward multiple of 17.3x our projected 2008 EPADS of $1.10.'
Read the full analyst report on RDY.
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