Opinions Matt Kacur
United Therapeutics Corp.UTHRCOMMENTNov 22, 2016
Matt KacurStock price when the opinion was issued
As of Jun 01, 2026. Market Open.
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Premium contentOur PAST TOP PICK with UTHR has triggered its stop at $349. To remain disciplined, we recommend covering the position at this time. This will result in a net investment gain of 51%, when combined with our previous guidance.
Premium contentPremium contentPremium contentPremium contentPremium contentPremium contentWith cash reserves growing, debt being reduced and shares bought back, we again reiterate UTHR as a TOP PICK. The maker of pulmonary hypertension medications is well diversified among multiple products allowing margins to continue to grow. It trades at 12x earnings, under 2x book value and supports an 18% ROE. We recommend trailing up the stop (from $210) to $219, looking to achieve $292 -- upside potential of 21%. Yield 0%
(Analysts’ price target is $292.25)Premium contentWe again reiterate UTHR as a TOP PICK. Recently reported earnings beat analyst expectations as the company established all time high revenues. It is bullish on its hypertension medication. It trades at 13x earnings, 2x book and supports a 17% ROE. We like that cash reserves continue to grow based on solid operating cash flows. We continue to recommend a stop-loss at $210, looking to achieve $287 -- upside potential of 19%. Yield 0%
(Analysts’ price target is $286.96)Premium contentWe reiterate UTHR as a TOP PICK. When earnings are released next week, it is expected that revenues are up over 11%. It trades at 13x earnings and 2x book. Cash reserves have been growing, while debt is retired. We recommend trailing up the stop (from $190) to $210 at this time, looking to achieve $285 - upside potential of 25%. Yield 0%
(Analysts’ price target is $284.60)Premium contentThe company markets pulmonary hypertension treatment drugs. Recently reported earnings rose 117% on the year, beating estimates by 18%. Cash reserves are growing. The company trades at 12x earnings, under 2x book and supports a ROE of 17%. We recommend placing a stop-loss at $190, looking to achieve $284 -- upside potential of 28%. Yield 0%
(Analysts’ price target is $284.60)United Therapeutic (UTHR-Q) or Allergan (AGN-N)? This is a tough one because they are 2 very different companies. Allergan is a much larger company and more broadly-based, however, this one is a very fine company. Its primary drug therapy is dealing with pulmonary disease. The risk of owning this is that one drug represents a high percentage of their total revenue.
Gordon Reid(A Top Pick Dec 19/12. Up 115.38%.) Involved in a very specialized area, pulmonary arterial hypertension, which is high blood pressure in the lungs. The big spike in the stock price came as a result of FDA approval of an oral application for one of their drugs. They are quickly establishing themselves as the “go to” drug maker in this critical area where a lot of people are at risk.
Gordon Reid(A Top Pick Dec 19/12. Up 81.38%.) Bio-pharmas are interesting because they have got a pipeline that is very exciting with new drugs coming on that are biology-based as opposed to chemical-based. Have always been extremely expensive, but this one isn’t. Trading at about 14-15 times next years earnings. There has to be a continuation of the acceptance of the existing product, but what he is really hoping for is an expansion of their product offering. They have 3 main drugs that they get most of their revenues off of. He’d like to see that at 6 or 12.
Gordon ReidIt is going to be news driven. In October one of their drugs was turned down by the FDA. The more drugs they have in their pipeline the less you will see of this. Growing well. Thinks it is good value. 10 times earnings.
Gordon Reid
A good company. ROC has been improving, and has been very high. Back in 2008, it had a 4% ROC. Including the trailing 4 quarters, he now shows a 35% ROC, so he knows the company is doing everything right. Remember that when you have that high return, it can turn over really fast, but for now it is good.