Valeant Pharma (VRX): Was Cautious, Investigation Doesn't Help - Mizuho
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Mizuho Securities analyst, Irina Koffler, reiterated her Neutral rating on shares of Valeant Pharmaceuticals (NYSE: VRX) after the stock sold off on news of an ongoing (not new) criminal investigation.
The analyst was cautious heading into the 3Q:16 earnings report because she expects management to cut 2016 guidance and the longer term outlook. However, the outlook is not dire.
Following the Aug 23 amendment, VRX must maintain an interest coverage ratio of 2:1, down from 3:1 previously. Based on updated estimates of $1.66B in interest expense in FY:16, the analyst believes VRX needs to generate FY:16 EBITDA of $3.32B. This is considerably below guidance of $4.8-$4.95B.
No change to the price target of $25.
Shares of Valeant Pharmaceuticals closed at $17.84 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change
Related EntitiesEarnings, Irina Koffler
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