Opinions John Petrides
Allergan PLC.AGNTOP PICKNov 29, 2016
John PetridesStock price when the opinion was issued
As of May 08, 2020. Market Open.
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(A Top Pick September 14/17- Down 22%.) This was a high-risk position. They sold a drug to a native band and then they leased the rights back to circumvent potential generic competition. Something cheeky and probably that is why the stock sold off. Their strength is still in Botox and aesthetics. He doesn’t see that changing or being threat. He still likes it. Management is under the gun.
Paul MacDonald
They are the maker of Botox. They have a drug for dry eye syndrome that will come off patent but his analysis of the case for losing all revenue from the drug has them still doing well. They have a good drug pipeline. (Analysts’ target: $225.00).
Michael Simpson, CFATheir number 1 product is Botox and their number 2 product is eye drops, and there is some competition coming from generics for their eyedrops drug. Thinks that is what has been hurting the stock recently. When the technicals are working against you where a stock has fallen below the 200-day moving average, and the price is below both the 50 day and 100 day, technically you want to step away.
We are in a structural bull market for equities. We are skating through the two toughest months of the year without much volatility. Don’t buy a company that has been put into the penalty box. Stocks that have broken down have an army of people who just want to get their money back.
They are known for Botox. Aesthetics is a big part of their business as well as a great urology business and Gastro Intestinal business. They sold their urology business and reinvested their cash into R&D. It is very inexpensive. (Analysts’ target: $271.50).
Paul MacDonaldThis has things like Botox, etc., but also have some things on the pharmaceutical side. He felt that they had a great quarter. Made 10 acquisitions in the past year with the proceeds of the generics they sold to Teva. Trading around 13X forward earnings, so not terribly expensive. He likes this one.
Paul MacDonald
(Top Pick Nov 29/16, Up 28.87%) He still likes it despite the return. They are very diligent at returning to shareholders. They have been making strategic acquisitions and their pipeline is full. He continues to like it.
John Petrides(A Top Pick Aug 17/16. Down 13.44%.) A terrific company, and shows up as the highest quality company in its group. Unfortunately, they got painted by the specialty pharmaceutical brush. It is getting a bit of a reprieve right now. He still likes this. It has one of the best growth profiles of any of the specialty pharmaceutical companies. The majority of its businesses are not subject to the same type of price controls that could come under government scrutiny.
Bruce Tatters
The healthcare sector has been the worst sector of the S&P 500 year-to-date, and yet the long-term fundamentals are still very strong. You have a growing global population and an aging population. That means the healthcare system, from a utilization standpoint, is going to continue to be under a lot of pressure regardless of Obama care. The valuation on the healthcare sector in general has not been this low since 2009 and back in 1994 for the past 25 years. They recently sold their generic business to Teva (TEVA-N) and got $40 billion. They are using the cash to buy back debt and to buy back stock. This owns Botox, one of the largest consumer drugs in the world. They are using the cash they got, to make small acquisitions to bolster their drug pipeline. Dividend yield of 1.44%. (Analysts’ price target is $266.11.)