Overall Score:
Trading Chart: 0
Analyst Opinion: 1
| Strong Buy | 5 | |
| Buy | 10 | |
| Hold | 3 | |
| Underperform | 1 | |
| Strong Sell | 0 | |
Insider Trading:1
Insiders definitely see some potential here leading off with the CFO Schiller’s apprarent open market purchase of 27,800 at $53.64 between 3-1 and 3-12
Management Discussion and Analysis: 1
Government regulation risk is high
Significant product liability risk
2012 guidance for revenue in the $3.1-$3.4bn range
Company merged with Biovail in Sep 2010
Company claims 9% organic growth in 2011. Results are murky due to the multiple acquisitions
US Neuro Volume was down 12%, but was partially offset by price increase of 8%
Other segments showed strong growth both in volume and price
4,100 SKUs, Wellbutrin 9% of sales, Zovirax 8%. Wellbutrin to continue to decline due to generic erosion
Mckesson (23%), Cardinal Health (21%), and AmerisourceBergen Corporation (10%) are top 3 customers
Continued R&D is needed to help offset declining sales once patent’s expire
Company is extremely acquisitive and has been a major source of growth
12/21/2011: Acquired iNova for $657mm, fair value of $44.5mm in contingent payments
12/16/2011: Acquired Dermik for $420.5mm
12/12/2011: Acquired OrthoDermatologics division of Janssen Pharmaceuticals for $346.1mm
10/17/2011: Acquired 74% of Afexa for $67.7mm, Acquired remaining shares for $22.5mm
08/19/2011: Acquired 87.2% of Sanitas for $392.3mm, Acquired remainder for total purchase price of $448.2mm
June 2011: Acquired exclusive rights to commercialize Elidel and Xerese cream for fair value of $437.7mm
Feb / Mar 2011: Acquired US and Canadian rights to Zovirax for $300mm
Mar 2011: Acquired PharmaSwiss for $491.2mm
Company has $6.65bn in debt
Forex risk, Company estimates that a 1% change in FX rates will impact shareholders equity by $35mm
Regulation Risk includes drug approval, sales practices and medicare rebates
Securities Purchasing Program authorizes upto $1.5bn in capital structure retirement
US Healthcare reform has potential to impact the Company negatively. Company has not quantified the impact
$275mm credit facility, $570mm in cash
Stock Performance relative to market: 0
Sector Outlook: 1
Positive, growth amongst all sectors driven by acquisitions. Negative overhang from healthcare regulation
Cash Flow: 0
Cash flow is difficult to determine given the rapidly changing nature of the Company through acquisitions
| 2009 | 2010 | 2011 | ||
| Revenues | $820.4 | $1,181.2 | $2,463.5 | |
| COGS | 204.3 | 395.6 | 683.8 | |
| Operating Expenses | 435.0 | 895.7 | 1,479.7 | |
| EBIT | 181.2 | (110.1) | 300.0 | |
| D&A | 149.3 | 254.5 | 612.6 | |
| EBITDA | 330.4 | 144.4 | 912.6 | |
| CFO | 360.9 | 263.2 | 676.5 | |
| CFI | (742.8) | 228.9 | (2,844.5) | |
| CFF | 177.0 | (213.3) | 1,948.2 | |
| Net Income | 176.5 | (208.2) | 159.6 | |
Peg Ratio: 0
Not Applicable since we have no EPS estimates for 2012
Valuation: 0
Given the rapidly changing nature of the Company (through acquisitions) ValuePro would not provide an accurate valuation for the stock.
Catalyst: 0
Continued acquisitions, good pipeline management, succesfull drug development