UPDATE: Morgan Stanley Downgrades Sagent Pharmaceuticals to Equal-Weight

Morgan Stanley cut its rating on Sagent Pharmaceuticals

from Overweight to Equal-weight and suspended its previous price target of $27 as it sees the company's path to growth to be challenging and delayed. Morgan Stanley said, "Downgrading to Equal-weight as the path to sustained revenue growth and margin expansion is proving longer and more challenging than we expected and key competitive and supply chain risks are materializing. That said, we continue to see long-term value in Sagent's business model. … Pricing pressure from larger competitors (oncology pricing cuts and GPO awards at the low end of expectations), the ephemeral nature of favorable FDA shortage product share and pricing, and the slow pace of FDA approvals are magnified by a concentrated revenue/profit base." Sagent Pharmaceuticals closed at $13.21 on Friday.