AZN Reliant on Existing Drugs

Tags: azn
5 Feb 11:22pm
Posted by ZacksResearch
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AstraZeneca PLC (AZN) is engaged in the research, development, manufacturing and marketing of ethical (prescription) pharmaceutical products. The company ranks among the top pharmaceutical companies in the world based on revenues and global sales force. It is a leader in cardiovascular, cancer and gastrointestinal drugs. Key drugs such as Crestor, Seroquel and Symbicort will continue to be the driving force of growth until the company can monetize its pipeline.

Generic competition will eat into revenue growth, but productivity initiatives should pay off in the form of healthier margins and mid-single digit earnings growth for the next few years. We see $45 as fair-value. Our rating is Hold.

We think the shares trade a relatively attractive level given the potential that management can deliver on its goals and significantly add to topline growth through pipeline successes. The current P/E of 9.7x is well below the large-cap pharmaceutical peer-group average of 15.5x.

Read the analyst note on AZN.




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