Amgen, Incyte Well Positioned Following Brexit
Despite the recent weakening of the GBP and EUR against the USD, there is limited impact to the 2Q-4Q 2016 figures, and most biotech companies under coverage exhibit a negative effect of less than 1 percent, Goldman Sachs’ Terence Flynn said in a report.
The NBI is down 26 percent, versus a 1 percent decline in the S&P 500. Analyst Terence Flynn believes that for the biotech group to outperform again, the following would need to fall into place:
- Improved visibility into US drug pricing dynamics
- Acceleration in product cycles
- Pipelines beginning to deliver
- Continued M&As at premium valuations
Amgen: Well Positioned
Flynn has a Buy rating on Amgen, Inc. (NASDAQ: AMGN) and believes that the company is well positioned since it has lower ex-US exposure [only 21 percent of revenues] relative to other large cap companies. Moreover, its valuation is undemanding and it has a growing dividend and upcoming pipeline catalysts, including AMG-334 Ph3 migraine data and Repatha IVUS data.
Incyte: Remains Attractive
The analyst has a Buy rating on Incyte Corporation (NASDAQ: INCY), saying that the company remains attractive in the current environment.
Incyte has limited FX exposure, with 89 percent of revenues being generated in the US. The commercial business is worth $59 per share, and upcoming catalysts in 2H are IDO, FGFR and BRD data, Flynn added.
Latest Ratings for AMGN
|Dec 2016||Oppenheimer||Initiates Coverage On||Outperform|
|Nov 2016||Mizuho||Initiates Coverage On||Buy|
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