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Abbott Laboratories Message Board

  • jd9919 jd9919 Nov 29, 2010 11:29 AM Flag

    Latest Goldman report on ABT

    Goldman analyst has tempered his outlook but still views ABT as undervalued at these prices. Actual report is 16 pages (with spreadsheets and charts), so the following is not the report in its entirety. No substantive narrative has been excluded, however. This will take more than one post ...

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    • You may go and do as Cramer, Goldman Sucks and all the other thieving Wall Street entities wants you to do; go to a neighbourgood pharmacy and buy a tube of KY; well, following your cretinisms, you know how to take it from them.

      Fact remains, you are an ignorant person who gets his info from those who love to invade your nether openings....

    • Hey, jerk.stat. turns out Cramer was right about the "Phase II/Phase III" comment, and you, of course, were wrong. Go back and read this thread, moron. Goldman makes it quite clear that Phase II testing is currently underway for other indications. So much for your expert scientist status, shorty.

      Punk.

      LOL

    • JD, the jackass,

      You, your Cramer THIEVING a_hole, and your Goldman Sucks have all been totally, completely DISCREDITED.

      STFU

    • thank you for the post frm GS......whateve one thinks of GS, their reports and evaluations are significant and do have an effect on the sh price.
      DO i have and confidence in GS ethics? NO,but that does mean the report is to be ignored.

    • "Estimate changes - In concordance with updating our immunology market model to reflect updated
      market shares, growth rate, and pricing estimates, we are modestly reducing our
      Humira estimates and lowering our 12-month price target to $54 from $58.
      We now project Humira worldwide sales of $7.58 billion in 2011 (down from $7.68 billion),
      rising to $9.94 billion in 2015 (down from $10.4 billion). We are also lowering our Abbott
      12-month price target to $54 from $58, which we arrive at by applying a lower 11.5X
      multiple to 2011 EPS to reflect the increased competitive risk to Humira. We have not
      changed our Humira estimate to reflect tasocitinib estimates, nor have we raised our Pfizer tasocitinib estimates (currently $80 million in 2012, rising to $700 million in 2015).

      "Upside risks to our view and price target include development of the JAK-3 inhbitors which could ultimately fail in clinical development, benefitting Humira; downside risks include further risk to our Humira forecasts based on worse-than-expected competitive dynamics."

      Americas: Healthcare: Pharmaceuticals
      November 28, 2010

    • "GS proprietary survey suggests JAK risk already priced into ABT - Given the pullback in ABT’s shares over the first positive P3 read-out of PFE’s JAK-inhibitor tasocitinib in rheumatoid arthritis, we conducted a physician survey to determine the potential competitive threat to Abbott’s
      most important driver, Humira. Survey results of 25 rheumatologists suggested that doctors perceived tasocitinib as differentiated and a meaningful competitor to the anti-TNF class by the first year on the market if the initial positive data bear out in the rest of PFE’s Phase III filing package (expected to be complete by mid-2011). However, our scenario
      analysis based on our proprietary immunology market model suggests that ABT’s shares already reflect PFE’s tasocitinib takes a 20% share of the market over the next several years.

      "Market may be early to punish ABT but near-term risk remains
      Given the tasocitinib data available thus far (three-month P3 data), we see the market being early to price in the competitive threat in ABT shares (down 13% since mid-October), for which PFE’s shares have not benefited. In our
      view, ABT appears undervalued, given near-term strong earnings power, but the JAK inhibitor overhang is unlikely to go away unless the program blows up or ABT engages in significant M&A activity that dilutes Humira’s importance to the bottom line. Humira makes up 50%+ of ABT’s earnings vs.
      <20% for Enbrel to Pfizer, and Remicade/Simponi to JNJ and MRK.

      "On the other side, tasocitinib could add net $1.50 to PFE shares
      On the flip side, PFE’s shares have largely shrugged off the tasocitinib data,
      given that it is still early to determine whether the drug is in fact a viable and sizeable competitor to the anti-TNFs. However, if PFE’s tasocitinib does in fact reach a 20% share of the market, we see it potentially reaching $2.5-
      $4.0 billion in global sales, (assuming a 20% discount to Humira), representing a net $1.50/share in NPV value to PFE (net of Enbrel loss) Updating estimates and price target

      "With our updated immunology market model, we are modestly reducing our Humira estimates by $100 mn in 2011 to $500 mn in 2015. We are also lowering our ABT 12-month price target to $54 from $58, which we arrive at by applying a lower 11.5X multiple to 2011E EPS to reflect the increased competitive risk to Humira. We have not reflected tasocitinib competition in our Humira estimates to, nor have we raised our PFE tasocitinib estimates."

      • 2 Replies to jd9919
      • ahhh, so Goldman didn't realize the shares would go straight down and want to cause a bounce to get out higher. i see. Master manipulators.

      • "ABT shares already price in threat of oral competitors to Humira - Given the pullback in Abbott’s shares over the first positive Phase III read-out of Pfizer’s JAK-inhibitor tasocitinib in rheumatoid arthritis, we conducted a physician survey to determine the potential competitive threat to Abbott’s most important driver, Humira. Survey results of 25 rheumatologists suggested that doctors perceived tasocitinib as differentiated and a meaningful competitor to the anti-TNF class by the first year on the market if the initial positive data bear out in the rest of Pfizer’s Phase III filing package (expected to be complete by mid-2011). However, our scenario analysis based on our proprietary immunology market model suggests that Abbott’s shares already reflect
        Pfizer’s tasocitinib takes a 20% share of the market over the next several years. This may be a real possibility, given our survey results, but we maintain that a lot needs to fall in place before that happens. Given the tasocitinib data available thus far (3 month Phase III data),
        we see the market being early to price in the competitive threat in Abbott’s shares (down 13% since mid-October), for which Pfizer’s shares have not benefited. However, we also
        see Abbott shares as likely range-bound in the near-term as investors will assume Pfizer’s tasocitinib works until it does not, particularly given four tasocitinib Phase III data read-outs in 2011, including a head-to-head with Humira.

        "In our view, Abbott shares appear undervalued, given near-term strong earnings power, but the JAK inhibitor overhang is unlikely to go away unless the program fails or Abbott
        engages in significant M&A activity that dilutes Humira’s importance to the bottom line. The stock could be poised for a rebound through the end of the year given its poor ytd
        performance, but we maintain our Neutral rating on the stock. Certainly, if Pfizer’s tasocitinib were to emerge as a meaningful competitor, it would pressure not only Abbott’s
        Humira, but also other drugs in the class such as Pfizer/Amgen’s Enbrel and J&J/Merck’s
        Remicade. However, we have seen disproportionate attention and weakness in Abbott’s shares as Humira makes up 50%+ of Abbott’s earnings vs. <20% for Pfizer, J&J, and Merck.
        On the flip side, Pfizer’s shares have largely shrugged off the tasocitinib data, given that it is still early to determine whether the drug is in fact a viable and sizeable competitor to the anti-TNFs. However, if Pfizer’s tasocitinib does in fact reach a 20% share of the market, we see it potentially reaching $2.5-$4.0 billion in global sales, (assuming a 20% discount to Humira), representing a net $1.50/share in NPV value to Pfizer (net of Enbrel loss)."

 
ABT
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