Market Overview

UPDATE: JP Morgan Downgrades GlaxoSmithKline to Underweight; Investments Risk Earnings

Related GSK
Liquidia Technologies And GlaxoSmithKline Advance Existing Collaboration; GlaxoSmithKline Exercises Option For Inhaled Therapeutics
GlaxoSmithKline's 'Unexpected Disappointment'
Premarket Biotech Digest: Anavex Uplisting, Discount On PCSK9 Inhibitors, Exact Sciences Plunges (Seeking Alpha)

JP Morgan reduced its rating on GlaxoSmithKline (NYSE: GSK) from Neutral to Underweight as the company's upcoming investment phase puts 2013 earnings at risk.

JP Morgan commented, "With material risk to 2013 earnings, no imminent positive catalysts, and almost no upside to our new PT, we downgrade to Underweight. GSK is entering an investment phase. After reassessing the investment required to execute on the pipeline, already taken for granted by consensus, we now expect Operating margins to contract, rather than expand in 2013, and we now forecast a 2013 Operating margin 200bps below consensus. We see earnings risk in 2013, with material Operating profit and earnings growth unlikely for at least a year further out than is currently forecast by consensus (which expects topline growth and margin expansion in 2013)."

GlaxoSmithKline closed at $46.07 on Tuesday.

Latest Ratings for GSK

Jun 2015Morgan StanleyDowngradesOverweightEqualweight
Jan 2015New Street ResearchDowngrades
Jul 2014MainfirstDowngradesUnderperform

View More Analyst Ratings for GSK
View the Latest Analyst Ratings

Posted-In: JP MorganAnalyst Color Downgrades Pre-Market Outlook Analyst Ratings


Related Articles (GSK)

View Comments and Join the Discussion!

Get Benzinga's Newsletters