Jefferies downgrades Cambrex on ‘dramatic’ sofosbuvir revenue drop

Jefferies analyst David downgraded Cambrex to Hold from Buy and lowered his price target for the shares to $43 from $63. The key issue, “though not the only, is the dramatic drop in sofosbuvir revenue,” Windley tells investors in a post-earnings research note. The “negative leverage from that is very hard to overcome,” contends the analyst. Compounding the problem, says Windley, is Cambrex’s three additional business lines coming in short of prior expectations. This adds to the revenue pressure and further challenges management’s ability to replace lost Gilead (GILD) EBITDA, he states.

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