Both Deutsche Bank and Credit Suisse have lowered their respective price targets on Shire (LON:SHP) in the wake of the group’s full-year results. The rare disease specialist update investors on its annual performance this week, cautioning that it was expecting slower earnings growth this year.
Shire’s share price has advanced in London in today’s session, having added 0.90 percent to 3,208.50p as of 13:20 GMT, marginally outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.66 percent higher at 7,282.65 points. The group’s shares have lost just under a third of their value over the past year, as compared with about a 0.1-percent gain in the Footsie.
DB points to limited near-term catalysts
Deutsche Bank, which has a ‘buy’ rating on Shire, lowered its price target on the shares from 5,000p to 4,500p yesterday.
“We remain buyers of the shares given a continued valuation disconnect but are cognizant that there remain limited catalysts in the near-term,” the analysts explained, as quoted by WebFG News.
The comments came after Shire disclosed this week that it was expecting its non-GAAP diluted American Depository Shares to be lower than top line growth in the current year, mainly on account of costs incurred from the start-up of the group’s new US plasma manufacturing site, growing competition from generics, as well as lower royalties.
Credit Suisse lowers EPS projections
Credit Suisse also remains upbeat on Shire with an ‘outperform’ rating, while trimming its valuation on the shares, from 4,500p to 4,000p. WebFG News quoted the analysts as explaining that their move to cut their price target was purely based on the three-percent cut in their earnings per share projections for the rare disease specialist for the current year.