Sunday, December 10

The demands of the IBEX 35 and the weakness of Moderna weigh on Rovi

The actions of Rovi down about 15 percent in the IBEX 35 since the beginning of the year, which places the value as the third worst in the selective.

Rovi does not start his career in the 35 club on the right foot. Landing in the largest selective of a country has great points in its favor, but also a greater point of demand.

Initially, the company will become part of the ETFs that replicate the index or those that include the main companies in a sector. But above all, visibility increases.

The number of investment entities that cover the value grows and this causes its repercussion, especially at the international level, to increase.

But this also implies that the levels of demand towards the company are higher by cataloging it as one of the main companies in a country.

Rovi is already recording this situation and 2022 kicks off with a drop in recommendation by the Franco-German broker Oddo BHF which downgraded its advice from “underreturn” to “neutral”.

The demand for historical highs

The titles of the Madrid laboratory are also listed under pressure to celebrate their access to the IBEX 35 with new all-time highs, registered on December 30, 2021 at 73.80 euros.

The market consensus considers that it does not have the capacity to recover this level, at least in the next 12 months.

The average target price places Rovi at 69.56 euros for said period and when trading above 64.5 euros, the potential for revaluation is 8 percent. The fact that it closed 2021 with a revaluation of 94.72 percent also weighs.

Caixabank BPI is el único broker of the consensus that gathers Bloomberg which estimates that the Madrid laboratory has the capacity to exceed historical maximums. your analyst Guilherme Marcedo estimates that it can reach new highs at 75 euros.

Rovi also has to cope with the falls that Modern registered since the beginning of the year, loses more than 25 percent, and the fact is that the price of the Spanish pharma is closely linked to that of its American partner.

The link between the two actions was made clear at the end of last year when Moderna announced a reduction in its vaccine production and sales estimates that translated into strong sales for Rovi.

The laboratory not only quickly recovered the ground lost by the news, but managed to record all-time highs.

The experts came out in defense of the Spanish company, arguing that cutting Moderna’s guides would not impact Rovi’s non-compliance, since it is a company that complies, despite unforeseen events, with the estimates released on the market.

Ready to exceed 2023 goals now

And it is that Rovi concluded each quarter of 2021 exceeding targets, although analysts point out that this is also due to a “excessive conservatism” of the board of directors, which is led by the highest shareholders and founders of the company, the family Lopez-Belmonte.

Rovi intends to close 2021 fulfilling the strategic plan that concludes in 2023 in its main points. For the moment, has already achieved the ebitda target to three years in the 158 million euros.

The López-Belmontes estimate that their company swill be able to reach the range of 588-609 million euros of operating income in the year just ended. Therefore, it is discounted that it will also achieve the goal of increasing them by a percentage of 40-45 percent in the year.

In consecuense, experts describe the goal of growing in this metric as “too conservative” in the middle band of the first ten, about 5 percent, in 2022 and more if the arrival of a new drug on the market is taken into account.

Two new drugs as catalysts

Rovi expects for next month the authorization of sale in the European Union of Risperidona ISM, a drug against schizophrenia that will be marketed in Europe under the name of Okedi. The first market where it hopes to distribute it is in Germany during the second trimester.

The United Kingdom would be added in the third quarter, same months for U.S, where it will be sold under the Risvan name. In this country he had to face a slowdown in the authorization of sale by the health agency, the FDA for its acronym in English.

The agency used a few months ago that it should visit the Rovi plants in Madrid for new inspections and that the mobility restrictions due to the coronavirus prevented technicians from traveling.

The drug will arrive in Spain at the end of the year and by 2023 it is estimated that a new product, Letrozerol, will be marketed, a treatment for breast cancer.

The visibility of Rovi thanks to the new products is high, consider the experts consulted, and the agreement with Moderna, despite the cutback of the American guides, should continue to accompany the business.

That is why it is the pharmaceutical company involved in the fight against the coronavirus at a global level that has the most support from the consensus since none of the experts recommends “selling” the titles and with a majority of purchase recommendations.