Oppenheimer Stays Bullish On Alexion Pharma

Alexion Pharmaceuticals, Inc. ALXN will report fourth-quarter earnings in late January, according to Oppenheimer. 

The Analyst

Oppenheimer's Hartaj Singh maintains an Outperform on Alexion Pharmaceuticals with a $115 price target. 

The Thesis

Alexion Pharmaceuticals is set up for better than consensus 2018 revenue and for non-GAAP EPS outperformance, Singh said. (See the analyst's track record here.) 

Oppenheimer is optimistic and projects the drug Soliris will outperform the  consensus by 400 bps due to strong fundamentals, macro/FX tailwinds and g/rMG launch, but also due to continuous OPEX rationalization, Singh said. The analyst is bullish despite risks regarding biosimilars, branded competition and a thin pipeline.

U.S. dollar weakness is going to manifest itself as a tailwind for the company as early as Q4 earnings, the analyst said. Alexion has historically been valued as a one-product company, and biosimilar risk is an existential threat, Singh said. A Phase 3 pivotal trial of ALXN1210 PNH/aHUS, a potential treatment for paroxysmal nocturnal hemoglobinuria, is a possible catalyst, according to Oppenheimer. 

The Price Action

Alexion closed Wednesday up 2.27 percent at $118.35. The stock is 3.6 percent lower year-to-date.

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