Perrigo (PRGO): Takeout Value Is $153 - Guggenheim

August 22, 2016 6:39 AM EDT
Get Alerts PRGO Hot Sheet
Price: $84.47 -0.22%

Rating Summary:
    11 Buy, 14 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 17 | Down: 27 | New: 28
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Guggenheim analyst, Louise Chen reiterated her Buy rating on shares of Perrigo Co. (NYSE: PRGO) after performing a Sum-of-the-Parts Analysis (SOTP) which suggests that PRGO shares are undervalued because clouds of uncertainty are masking the underlying growth potential of good assets (Consumer, Rx, Pipeline in '17+).

Management changes, several downward earnings revisions, generic drug pricing headwinds and a slowdown in Consumer launches this year have weighed on PRGO's stock through 1H16. PRGO shares are now down 37.8% YTD vs. +6.9% for the S&P500, and overall sentiment is negative on the stock. The analyst believes expectations have been reset and PRGO's risk/ reward is skewed to the upside.

As part of the analysis, Ms Chen, estimated PRGO's take-out value and derived $153 per share, 69% upside from where the stock is trading now. MYL was willing to pay ~$177 per share for PRGO's stock last year, she believes the fundamentals of the business have not deteriorated that much since then.

No change to the price target of $125.

For an analyst ratings summary and ratings history on Perrigo Co. click here. For more ratings news on Perrigo Co. click here.

Shares of Perrigo Co. closed at $91.83 yesterday.



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