Auriga Starts Salix Pharmaceuticals (SLXP) at Hold; Growth Gastrointestinal Drug Company, But Share Price Appears Properly Valued
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Price: $172.81 --0%
Rating Summary:
7 Buy, 14 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
7 Buy, 14 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Auriga initiates coverage on Salix Pharmaceuticals (NASDAQ: SLXP) with a Hold. PT $30.00.
Auriga analyst says, "Revenue growth took off in March 2010 when Xifaxan obtained the approval for treating hepatic encephalopathy (HE); the HE label is an orphan indication, and hence Xifaxan obtained market exclusivity of seven years with additional patent protection extending through 2024-2029. The company has a strong balance sheet with no net debt. Management is seasoned, stable, and led the company through a difficult period when the company lost almost 50% of its revenue due to generic entry of Colazal in 2007. However, several weaknesses surfaced in 2011. First, the FDA did not approve Xifaxan for use in irritable bowel syndrome patients which would expand the current Xifaxan market significantly. Second, organic growth of Xifaxan showed signs of slowing. Third, there are no additional near term catalysts that could add meaningful upside. We believe the shares are properly valued at in the current price range."
For more ratings news on Salix Pharmaceuticals click here and for the rating history of Salix Pharmaceuticals click here.
Shares of Salix Pharmaceuticals closed at $28.42 yesterday.
Auriga analyst says, "Revenue growth took off in March 2010 when Xifaxan obtained the approval for treating hepatic encephalopathy (HE); the HE label is an orphan indication, and hence Xifaxan obtained market exclusivity of seven years with additional patent protection extending through 2024-2029. The company has a strong balance sheet with no net debt. Management is seasoned, stable, and led the company through a difficult period when the company lost almost 50% of its revenue due to generic entry of Colazal in 2007. However, several weaknesses surfaced in 2011. First, the FDA did not approve Xifaxan for use in irritable bowel syndrome patients which would expand the current Xifaxan market significantly. Second, organic growth of Xifaxan showed signs of slowing. Third, there are no additional near term catalysts that could add meaningful upside. We believe the shares are properly valued at in the current price range."
For more ratings news on Salix Pharmaceuticals click here and for the rating history of Salix Pharmaceuticals click here.
Shares of Salix Pharmaceuticals closed at $28.42 yesterday.
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