Sanofi: BarCap downgrades stock
(CercleFinance.com) - Barclays Capital (BarCap) has downgraded its rating on the Sanofi share from "weigh in line" to "underweight" and has cut its 12-month target price by 13% to 65 euros, the day after the health group reached an agreement to acquire Bioverativ.
"Whilst a ~E9.5bn deal is modest in the context of the Sanofi group, it looks overpriced and strategically questionable," the broker states in its report.
BarCap has difficulty seeing how the target ROIC will exceed the WACC within the next three years, or how this target could be maintained over time, given the structural pressure coming from the gene therapy ACE910.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
"Whilst a ~E9.5bn deal is modest in the context of the Sanofi group, it looks overpriced and strategically questionable," the broker states in its report.
BarCap has difficulty seeing how the target ROIC will exceed the WACC within the next three years, or how this target could be maintained over time, given the structural pressure coming from the gene therapy ACE910.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.