- Charles River Laboratories ( NYSE: CRL ) gained in the pre-market trading Friday after Jefferies upgraded the non-clinical contract research organization (CRO) to Buy from Hold, noting the company’s prospects in the market for non-human primates (NHP).
- The analysts led by David Windley argued that the NHP supply chain significantly changed during and before the pandemic. They reasoned that demand rose while China halted exports and drug development moved to large molecules and advanced therapies,
- “That price escalation is unlikely to abate (in fact, should continue rising) in the medium term,” the team wrote, forecasting a ~6x price increase over three years.
- Jefferies said that the pricing strength would more than offset the softness in CRL’s Discovery and non-NHP Safety Assessment (SA) segment, which according to the analysts, indicated a flattish growth on a constant currency basis in the first half of the year.
- The team raises the CRL price target from $230 to $240 per share, which stands more than 10% below the current average price target on Wall Street.
For further details see:
Charles River raised to Buy at Jefferies on prospects for animal studies