Mizuho Securities Remains Bullish on Mallinckrodt (MNK) Following Strong 4Q
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Mizuho Securities reiterated a Buy rating and $87.00 price target on Mallinckrodt plc (NYSE: MNK) following the company's 4Q earnings report. MNK reported revenues of $887.2M and adjusted EPS of $2.04, both ahead of consensus estimates of $832.1M and $1.90. Total branded sales of $633.1M outperformed consensus estimates of $596.6M.
Analyst Irina Koffler commented, "Mallinckrodt reported 4Q:FY16 revs of $887.2M and adj. EPS of $2.04 vs. FactSet consensus $832.1M and $1.90 and our estimates of $855.5M and $1.92 (our model has been calendarized so the figures correspond to our 3Q:CY16). Mgmt made no updates to its prior 2016 calendar year EPS guidance of $8.50-$8.80, although this does not account for additional dilution associated with divestiture of its Nuclear Imaging business (mgmt. previously guided to dilution of $0.25-0.35 per quarter associated with this deal). Mgmt also indicated that it had repurchased 0.7M shares for $50.3M during the quarter (less than we expected) and has ~$425M remaining in its buy-back program. One other notable announcement is a temporary supply disruption in Therakos kits which may negatively impact revenues by $5-10M/quarter over the next two quarters. Mgmt. expects the strength of its business to offset most of the earnings impact of this disruption. We reiterate our Buy rating and will review our $87 PT after the 8:30 am earnings call."
Shares of Mallinckrodt plc closed at $57.67 yesterday.
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