Needham & Company Maintains a 'Strong Buy' on Par Pharmaceutical (PRX); Confirms Purchase of Divested Teva-Cephalon Products for Bargain Price

Needham & Company maintains a 'Strong Buy' on Par Pharmaceutical (NYSE: PRX) price target of $38.00.

Needham analyst says, "PRX at last officially disclosed the purchase of a basket of niche generics coming out of the Teva (Nasdaq: TEVA)(Strong Buy)/Cephalon merger. Details were largely already in the public domain after the Federal Trade Commission disclosed consent terms tied to its approval of the transaction. Key missing data points prior to today were mainly margin economics on the products and most importantly how much PRX had to spend to acquire them. Consistent with our original expectation, PRX basically got a steal in our view, acquiring the assets for the tidy little sum of $25.0MM. Generic Actiq alone would more than justify the purchase price in our book."

"Bottom line – transaction provides significant visibility upgrade to 2012 EPS with potential combined contribution in the range of $0.60-$0.70. While Provigil will be a “zero” post exclusivity expiration, sustainable EPS contribution of combined Amrix/Actiq assets should still be on the order of $0.25-$0.30."

For more ratings news on Par Pharmaceutical click here and for the rating history of Par Pharmaceutical click here.

Shares of Par Pharmaceutical closed at $30.04 yesterday.

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