Tuesday, December 7

Pharmamar and Grifols sharpen their stock market potential

Pharmamar and Almirall fall more than 20 percent on the IBEX 35 so far in the fourth quarter and Grifols loses more than 15 percent in the same period. These decreases place the pharmaceutical sector as the one with the worst performance since October in the main indicator of the Spanish Stock Market.

In addition, in the cases of Grifols and Pharmamar, these losses mean that they are the third worst value on the selective so far this year, with a fall of more than 25 percent, and the fifth, with a decline of close to 20 percent, respectively.

Despite this, the market consensus estimates that both companies have ability to recover at least half of its value over the next 12 months.

Pharmamar needs more news from the Zepzelca

Pharmamar is trading below € 60 and its current bearish streak is closer to € 55, but the consensus average target price is € 91.04, so shows a one-year revaluation potential greater than 55 percent.

Pharmamar is short of catalysts that can increase its value since its star drug, Zepzelca, is in different stages of study to achieve final marketing approval in the United States. This would open the door to achieving the same milestone in Europe.

The drug is already sold in the United States under emergency sales authorization and in the European Union thanks to the compassionate use formula.

After the sales data for the third quarter in the United States, experts maintain confidence in the product and in the biopharmaceutical.

Barclays noted in a recent report that Zepzelca’s growth prospects are “intact” with a 10 percent annual growth, but in the absence of news, which may not arrive until 2022, most analysts who follow Pharmamar prefer to “keep ”The portfolio positions until new events.

Grifols continues to be pressured by debt

While Pharmamar needs the Zepzelca to recover half of what it lost, once the Aplidin against the coronavirus is out of the market catalysts, Grifols must offer a clear strategy with the debt to achieve the potential that the consensus of the market.

Grifols’ stock market penance is linked to its debt problems, and the market is waiting to see if the recovery levels of plasma donations recover at the rate announced by the pharmaceutical company.

The sovereign wealth fund of Singapore has injected 884 million euros to become a strategic investor in Biomat USA, a Grifols subsidiary, and Grifols will use the amount to reduce leverage, but it is not enough for rating agencies that continue to downgrade their prospects.

However, fundamental analysts do believe in Grifols’ growth capacity both in Europe and in the United States and with the stock trading above 17.5 euros they set an average target price of 26.92 euros. This value translates into a potential facing more than 50 percent and most experts, 63.6 percent of the consensus, recommend “buying” stocks.

Almirall’s potential is 35 percent

Almirall paid for the drop in margins reflected in its results until September and the deterioration in sales of some of its key drugs with the price cut of half a dozen investment entities.

The downgrades have meant that Almirall’s revaluation potential falls to 35 percent based on an average target price of 14.43 euros and a current price of 10.5 euros. But analysts are also aware of the improvement of the company’s forecasts.

Therefore, it does not register any recommendation to “sell” and the majority are to “buy”, 54.3 percent. Almirall’s titles, despite the bad fourth quarter, have moved flat so far this year.


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