Lake Street analyst Brooks O’Neil raised his price target for BioScrip to $10 from $4.50 following yesterday’s first investor day under the leadership of Dan Greenleaf. The company’s business transformation is largely complete and BioScrip is on track to deliver a breakout year in 2019, O’Neil tells investors in a research note. The analyst says he now has a line of sight back to $1.0B of annual revenue. Further, he believes BioScrip is capable of generating an adjusted EBITDA margin of 13% and expects the company to generate enough free cash flow to repay at least $200M of debt over this time horizon. Investors or a strategic acquirer will reward BioScrip with a 15.5 times enterprise value to adjusted EBITDA multiple “as this scenario plays out,” O’Neil writes. As such, he believes BioScrip will be worth at least $10 and keeps a Buy rating on the name. The stock closed yesterday down 10c to $3.77.
Friday, December 7, 2018
Synthorx opens at $15.40, IPO priced at $11.00 per share
Synthorx (THOR) priced 11.9M shares at $11.00. The deal size was increased to 11.9M shares from 9.1M shares and priced between the $10.00-$12.00 range. Jefferies, Leerink and Evercore ISI acted as joint book running managers for the offering.
Mallinckrodt investor worries ‘worthy of concern,’ says Wells Fargo
Wells Fargo analyst David Maris attrubites the 7% selloff yesterday in shares of Mallinckrodt to investors recognizing that the spin-off process could take at least six months and the proceeds previously expected from a sale will now come in the form of levering the spin with debt. Furthering pressing the shares could the realiztioin that the company’s opioid and environmental liabilities may not have been fully appreciated, Maris tells investors in a research note partially titled “Questions, But A Reasonable Alternative.” The fact that the generics business now has to be consolidated after being reported as a discontinued operation, only to be taken out again when the spin is completed is also challenging for some investors, Maris writes. The analyst, while admitting Mallinckrodt’s current cash flow is “very appealing,” acknowledges that the re-consolidation and then spin of the generics unit, pending competition of Inomax in 2019, and investor worries about Acthar is “worthy of concern.” He maintains a Market Perform rating on Mallinckrodt shares with a $27 price target.
Elliott has taken stake in Bayer, Reuters reports
Activist investor Elliott Management has held stock in Germany’s Bayer for over a year, according to Reuters.
Novartis downgraded to Underweight from Equal Weight at Barclays
https://thefly.com/landingPageNews.php?id=2834019
Craig-Hallum maintains Buy rating, $11 target on Akorn after Fresenius ruling
Craig-Hallum analyst Matt Hewitt said the Delaware Supreme Court ruling in favor of Fresenius (FSNUY) ends any hopes that a merger with Akorn (AKRX) will still occur, which may be a disappointment to some investors. However, it has been his view since the first ruling was announced that Akorn should be valued on a standalone basis. Akorn currently has a large pipeline of higher margin generics and the company’s low-cost manufacturing facility in India has been idled due to the terms of the Fresenius agreement, but is likely to be brought online sometime in FY19 or FY20, Hewitt tells investors. He keeps a Buy rating and $11 price target on Akorn shares, which are down $1.34, or 24%, to $4.25 in afternoon trading.
https://thefly.com/landingPageNews.php?id=2834039
Amgen raises quarterly dividend 10% to $1.45 per share
Amgen announced that its board of directors declared a $1.45 per share dividend for the first quarter of 2019. The dividend will be paid on March 8, 2019, to all stockholders of record as of the close of business on Feb. 15, 2019. This represents a 10% increase from that paid in each of the previous four quarters.
https://thefly.com/landingPageNews.php?id=2834073
https://thefly.com/landingPageNews.php?id=2834073
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