Medco Poised For Bright Future, Says Deutsche Bank (MHS)

Deutsche Bank analysts Ross Muken, Michael Cherny, and Vijay Kumar reiterated a Buy rating and %78 price target for Medco

. The analysts see sustained growth at Medco, driven by several drivers, including growth in generics, mail, and PGx. They said, "While there is some debate on the PBM growth trajectory post-generic boom, we remain confident that MHS’ management will execute on its strategy to continue to expand its various growth drivers." MHS recently announced a joint venture with Celesio to provide services in Europe. Deutsche Bank believes this could be a 250 billion Euro opportunity. Deutsche Bank's $78 price target is the midpoint of their DCF range, equating to 23x a FY10 EPS of $3.40