UBS on U.S. Pharma – Large Cap and Specialty: 4Q11 Preview: Things Still Look Interesting
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Rating Summary:
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Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
17 Buy, 13 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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UBS on U.S. Pharma – Large Cap and Specialty: 4Q11 Preview: Things Still Look Interesting
UBS analyst, Marc Goodman, said, "We still like the Generics: Mylan (NYSE: MYL), Teva (Nasdaq: TEVA), Watson Pharma (NYSE: WPI): We like MYL’s visibility into 2012 with multiple generic launches and growth in EMs and Dey driving EPS upside. For TEVA, we believe the diversification strategy is working and at this valuation, investors don’t appear to expect much from Copaxone after this year. And for WPI, we have confidence in Prochieve and see Mucinex, a potential Lidoderm settlement and the analyst day driving the stock."
Still see many opportunities in spec pharma: Valeant Pharmceutical (NYSE: VRX), Endo Pharmaceuticals (Nasdaq: ENDP), Warner Chilcott (Nasdaq: WCRX), Allergan (NYSE: AGN) - For Valeant, we continue to see significant opportunity for consolidation in pharma and see substantial deal flow, continued synergies and solid core growth again driving 20%+ EPS growth. While the Novartis plant issues represent an overhang for Endo, we see the Opana TRF approval, medtech diversification and a Lidoderm settlement or win all driving multiple expansion. WCRX remains attractive, as Asacol’s durability and the significant leverage in the business are underappreciated. And AGN should have another strong year in 2012."
"In large-cap, Pfizer (NYSE: PFE) and Merck (NYSE: MRK) are our favorites Pfizer is on the heels of a continually-improving pipeline (most recently the Prevnar 13 Adult approval), a dividend bump and new share repo plan and we look forward to management’s strategic plan with Nutrition/Animal Health. For Merck, we believe investor perception for the pipeline will improve over the next 18 months."
UBS analyst, Marc Goodman, said, "We still like the Generics: Mylan (NYSE: MYL), Teva (Nasdaq: TEVA), Watson Pharma (NYSE: WPI): We like MYL’s visibility into 2012 with multiple generic launches and growth in EMs and Dey driving EPS upside. For TEVA, we believe the diversification strategy is working and at this valuation, investors don’t appear to expect much from Copaxone after this year. And for WPI, we have confidence in Prochieve and see Mucinex, a potential Lidoderm settlement and the analyst day driving the stock."
Still see many opportunities in spec pharma: Valeant Pharmceutical (NYSE: VRX), Endo Pharmaceuticals (Nasdaq: ENDP), Warner Chilcott (Nasdaq: WCRX), Allergan (NYSE: AGN) - For Valeant, we continue to see significant opportunity for consolidation in pharma and see substantial deal flow, continued synergies and solid core growth again driving 20%+ EPS growth. While the Novartis plant issues represent an overhang for Endo, we see the Opana TRF approval, medtech diversification and a Lidoderm settlement or win all driving multiple expansion. WCRX remains attractive, as Asacol’s durability and the significant leverage in the business are underappreciated. And AGN should have another strong year in 2012."
"In large-cap, Pfizer (NYSE: PFE) and Merck (NYSE: MRK) are our favorites Pfizer is on the heels of a continually-improving pipeline (most recently the Prevnar 13 Adult approval), a dividend bump and new share repo plan and we look forward to management’s strategic plan with Nutrition/Animal Health. For Merck, we believe investor perception for the pipeline will improve over the next 18 months."
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