Nomura Securities Upgrades Akorn (AKRX) to Buy

Nomura Securities upgraded Akorn (NASDAQ: AKRX) from Neutral to Buy with a price target of $46.00 (from $44.00), saying the underlying intrinsic value is worth any near-term risk.

Analyst Shibani Malhotra commented, "We upgrade Akorn Inc (AKRX), to Buy from Neutral and raise our Target Price to $46 from $44. We recognize that we still lack visibility into whether the company can file its financials in time to clear Nasdaq listing requirements. However, since our September initiation, there have been number of positive developments that give us more comfort. Still, AKRX remains down 59.9% (vs. -0.7% for the S&P500) since the 4/24 announcement that financials require restatement, providing an attractive entry point to build positions in one of the more attractive assets in the sector."

The analyst highlighted the following factors driving their bullish view:

• We are more confident Akorn can regain Nasdaq compliance and avoid delisting following our recent discussion with management.
• Current share price implies nearly 60% risk of delisting per our analysis; sets up compelling risk/reward in our view.
• Underlying asset value has increased with strong execution in 2015; $35mn restatement seems relatively minor versus fundamental value.

For an analyst ratings summary and ratings history on Akorn click here. For more ratings news on Akorn click here.

Shares of Akorn closed at $34.55 yesterday.

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