Jefferies Cuts Price Target & Estimates on Sagent Pharm. (SGNT), Margins Have Potential
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Price: $21.76 --0%
Rating Summary:
1 Buy, 9 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 19 | Down: 16 | New: 9
Rating Summary:
1 Buy, 9 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 19 | Down: 16 | New: 9
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Jefferies is reiterating its Buy rating on shares of Sagent Pharmaceuticals (NASDAQ: SGNT), but is reducing its price target from $31 to $28.
The company released its Q2 results with $32.3 million in sales and an EPS loss of $0.37, which was well below the firm's estimates of $35.6 million and a loss of $0.27 and the consensus of $34.5 million and a loss of $0.21. The firm notes that the miss reflects a 12-day delay in getting Gx Levaquin bags approved.
SGNT reported a Q2 gross margins of 8.5 percent, way under what the 20 percent that the firm and consensus was forecasting.
An analyst at Jefferies comments, "For full year '11, SGNT guided GM% in the "mid-teens," thereby implying Q3 & Q4 GM% near or above 20%. Given Q2's 8.5%, this might seem a stretch, but for a company the size of SGNT, it only takes a few products to make a big difference. For example, newly launched Gx Levaquin has been doing well, and while 1st to market, it currently competes vs. only one other player."
The firm is lowering its 2011 revenue estimate from $161 million to $152 million and its EPS estimate from ($0.43) to ($0.79) due to pricing pressures on Gx Zosyn & Gemzar. Jefferies is also lowering its 2012 EPS estimate from $0.58 to $0.50.
For more ratings news on Sagent Pharmaceuticals click here and for the rating history of Sagent Pharmaceuticals click here.
Shares of Sagent Pharmaceuticals closed at $23.39 yesterday.
The company released its Q2 results with $32.3 million in sales and an EPS loss of $0.37, which was well below the firm's estimates of $35.6 million and a loss of $0.27 and the consensus of $34.5 million and a loss of $0.21. The firm notes that the miss reflects a 12-day delay in getting Gx Levaquin bags approved.
SGNT reported a Q2 gross margins of 8.5 percent, way under what the 20 percent that the firm and consensus was forecasting.
An analyst at Jefferies comments, "For full year '11, SGNT guided GM% in the "mid-teens," thereby implying Q3 & Q4 GM% near or above 20%. Given Q2's 8.5%, this might seem a stretch, but for a company the size of SGNT, it only takes a few products to make a big difference. For example, newly launched Gx Levaquin has been doing well, and while 1st to market, it currently competes vs. only one other player."
The firm is lowering its 2011 revenue estimate from $161 million to $152 million and its EPS estimate from ($0.43) to ($0.79) due to pricing pressures on Gx Zosyn & Gemzar. Jefferies is also lowering its 2012 EPS estimate from $0.58 to $0.50.
For more ratings news on Sagent Pharmaceuticals click here and for the rating history of Sagent Pharmaceuticals click here.
Shares of Sagent Pharmaceuticals closed at $23.39 yesterday.
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