UPDATE: Cantor Fitzgerald Initiates Coverage on Charles River Laboratories on Good Market Position
In a report published Wednesday, Cantor Fitzgerald analyst Sung Ji Nam initiated coverage on Charles River Laboratories (NYSE: CRL) with a Buy rating and $53.00 price target.
In the report, Cantor Fitzgerald noted, “As a leader in the drug discovery and preclinical segment of the contract research organization (CRO) market, we think the company is well positioned to take market share with increased outsourcing of preclinical research by pharmaceutical and biotechnology companies. We believe that CRL has industry-leading margins and headroom for further expansion with improved end-market demand, and a strong FCF profile enabling expansion of technological capabilities and geographic footprint through acquisitions. While the pharmaceutical industry has recently prioritized R&D funds supporting late-stage clinical studies to address impending sales erosion from the much anticipated blockbuster patent expirations, we think increased outsourcing in the preclinical segment is inevitable longer-term, as the pharmaceutical companies have recognized the need for a paradigm shift in improving R&D productivity.”
Charles River Laboratories closed on Tuesday at $46.62.
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