Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is scheduled to report its fourth-quarter earnings tomorrow morning, and H.C. Wainwright analyst Ram Selvaraju is weighing in on what’s in store. As always, there seems to be little space between the bulls and bears, and Selvaraju stands somewhere in the middle.
Selvaraju reiterates a Neutral rating on VRX, while reducing the price target to $18.00 (from $24.00), which implies a slight downside from current levels. Valeant shares closed today at $18.50, down nearly 2% or -$0.38.
The analyst wrote, “Our 2018 top-line revenue number has been lowered to $8.56B vs. our original projection of $9.16B to reflect the following: (1) impact of divestitures and asset sales, which had been indicated to decrease revenues by $460M on an annualized basis going forward; (2) factoring in losses of exclusivity (LoE) on products losing patent protection or facing further erosion from generic introductions, including drugs like Syprine; and (3) hurdles to commercial uptake of newly-launched drugs, including new product blocks by reimbursement agencies, which may preclude new product launches from fully offsetting the negative impact of divestitures and LoEs.”
“We currently project 2018 revenue at $8.56B, reflecting the impact of asset divestitures and potential losses of exclusivity on certain products and gradual revenue ramps for new products. We expect that management should provide granular guidance for 2018 during its upcoming earnings conference call,” the analyst added.
Overall, TipRanks points to caution when it comes to Valeant, with the Street divided on whether to be bullish, sidelined, or bearish on this drug maker. Out of 9 analysts polled in the past 3 months, 2 rate VRX stock a Buy, 3 issue a Hold, while 4 recommend a Sell.
Valeant is a multinational specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of dermatology, gastrointestinal disorders, eye health, neurology and branded generics.