Opinions Paul MacDonald
Astrazeneca P L CAZNCOMMENTOct 20, 2020
Paul MacDonaldStock price when the opinion was issued
As of Jun 08, 2026. Market Open.
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Very advanced pipeline will add significant revenue. Good story still intact.
Darren Sissons
Has broad platform of diseases they treat. Trades around 15x PE and pays a 2% dividend yield. Shares are still snapping back from some news in China last year, so there's more room to recover.
Jim LebenthalAbbvie and AZN are two good healthcare stocks, a sector in which you must be picky because of weakness. Both trade around 15x and pay around a 3% dividend yield.
Joe TerranovaIn oncology, but he isn't deeply familiar with its product pipeline. He can say, with quite a bit of confidence, that they've been improving on fundamentals since around 2017-18. ROC marched up from 6% to 13%, very consistent. Pretty good valuation at 13x EV/EBITDA. Well run.
He doesn't get too hung up on a weak couple of years. If the fundamentals are there, you just have to wait it out.
Likes the pipeline. A number of candidates to seek approval in the next couple of years, which will be a catalyst for earnings going forward. Fairly productive R&D engine. Also growth through tuck-in acquisitions. Relatively attractively priced given current growth outlook. Going to be second-fastest growing drug stock in Europe behind NVO. Yield is 3.06%.
(Analysts’ price target is $85.38)Darren SissonsBig breakthroughs in cancer. One drug failed recently. We're in the midst of a malaise of selling and going to cash. Great story.
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Premium contentOur PAST TOP PICK with AZN has triggered its stop at $71. To remain disciplined, we recommend covering the position at this time. This will result in a net investment gain of 1%, when combined with our previous guidance.
Premium contentThey rallied last summer, then faced headwinds last fall when a cancer drug failed to perform in trials and there was an investigation in their large Chinese business. Both problems are clearing now. They have a drug pipeline that should become a great growth story. Trades at 15x PE.
Jamie Murray Premium contentWe reiterate AZN as a TOP PICK. Recently reported earnings indicated a 19% increase in earnings and revenues. Management announced positive development on 9 new drugs worth $5 billion in future revenues and a plan to invest over $800 million in Ontario creating 700 jobs. The shares trade at 18x earnings and support a 30% ROE. We recommend trailing up the stop (from $52) to $64, looking to achieve $88 -- upside potential of 21%. Yield 1.4%
(Analysts’ price target is $88.24)
Their Covid vaccine in progress For most of the large-cap pharmas he owns, the benefits of producing this vaccine won't benefit these companies as much as people think. That said, AZN has been executing very well in areas like oncology--a key driver for them. In May, AZN's vaccine was his front runner in this race. AZN (with Oxford University) did have a negative reaction during their recent phase 3 test, though, so there is a risk here. However AZN has resumed tests outside the U.S., so expect results a little later. So now Pfizer has become the front runner. He's looking for the safety profile of AZN's candidate. If their vaccine is a miss, there will be stock volatility, but also a buying opportunity. A great company.