AZNCF - AstraZeneca: The Price Upside Is Exhausted For Now (Rating Downgrade)
2024-06-15 10:58:09 ET
Summary
- As expected, AstraZeneca's price has increased in the past quarter, and by a notable 18.4%, following a robust Q1 2024 performance.
- Recent approvals in the US market, earlier attractive market multiples and a dividend increase also supported the stock's performance.
- However, its latest acquisition of Fusion Pharmaceuticals can drag earnings down, its long-term revenue growth target is lower than current rates and the market multiples indicate it's fairly valued.
Since I last wrote about the UK based pharmaceuticals company AstraZeneca ( AZN ) in March, its price is up by a significant 18.4%. Even at that time it was more than obvious that the stock is due an uptick this year. Even the article itself was titled "5 Reasons AstraZeneca Stock Can Rise In 2024", which were as follows:
- After its better than expected results in 2023, the revenue guidance for this year was particularly healthy.
- Similarly, core EPS outperformance was observed, leading to a robust outlook for 2024.
- A spate of approvals, including in its big US market added to optimism on the AstraZeneca stock.
- A higher trailing twelve months [TTM] dividend yield than the average for the healthcare sector. And while it was still low compared to some pharmaceuticals' peers, over time, it the dividends had added substantially to total returns from the stock.
- The market multiples were attractive too, with a forward non-GAAP P/E of 16.3x, lower than the 19.7x for the healthcare sector.