UniCredit Bank Maintains its BUY Rating on Roche

October 11 00:00 2011

LONDON, October 11, (RainbowNewsLine.com) – Analysts at UniCredit Equity Research maintain their BUY rating on the shares of Roche (ROG.VTX). The target price is set to CHF 160.00.

In a research note published this morning, analysts at UniCredit Equity Research, mention that the company’s 3Q11 sales are expected to be in line with the consensus. The company is scheduled to release its sales on Thursday. The major takeaways are:

  • Driven by Lucentis upside and Pegasys, FY11 is projected to achieve 14% CER EPS growth. The analysts believe that FY11 guidance of ‘around 10%’ CER core EPS growth is secure and there is high probability of Roche raising its FY11 guidance again to double digits.
  • The analysts forecast a 3% CER sales growth in 3Q11, primarily due to collapse of Avastin & Tamiflu. The recent weakening of CHF caused a negative impact on sales of -16% in 3Q11.
  • Japan’s sales recorded a low in 3Q11 due to the earthquakes, and expected to make a comeback and push the sales in 2012.
  • Roche is taking measure to drive sales in emerging markets by introducing flexible pricing and patient access.

The key reasons that highlight the BUY rating are focused cancer R&D begins to be appreciated, underlying margin expansion is fortifying the growth, and Roche has the best cash generation structure in the sector.