Hapoalim Securities Lowers Estimates And Reiterates Hold On Auxilium Pharmaceuticals (AUXL)

Hapoalim Securities is out with a report, where it reiterates its “hold” rating on Auxilium Pharmaceuticals

; it has also set a $25.00 price target on the stock. AUXL recently reported 2Q10 EPS of $0.28 that missed analyst and consensus estimates. The EPS miss due to lower Testim revenue and higher operating costs. Auxilium reported 2Q10 Xiaflex sales of $2 million, but analysts believe the Xiaflex adoption will remain a slow process as they have yet to see impressive revenue growth on the product. Driven by higher than estimated operating costs, the analysts at Hapoalim Securities have lowered their 2010-2014 EPS estimates. Analysts added, “Our $25.00 per share price target valuation assumes that pharmaceutical products are generally sold at 4x peak sales (a historical average) which we apply to our 2014 sales estimate for Xiaflex. For Testim, because of the recent cardiovascular controversy, we give the product a 1x sales multiple, due to the uncertain future of testosterone replacement and generic Androgel competition expected in 2015.” Shares of AUXL are currently trading at $26.04, up 66 cents in midday trade.