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Amgen, Incyte Well Positioned Following Brexit

Amgen, Incyte Well Positioned Following Brexit
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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:

  1. Improved visibility into US drug pricing dynamics
  2. Acceleration in product cycles
  3. Pipelines beginning to deliver
  4. Continued M&As at premium valuations

Related Link: Credit Suisse Leaves AbbVie Management Meeting Feeling Optimistic

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

Feb 2018Atlantic EquitiesDowngradesOverweightNeutral
Feb 2018Credit SuisseMaintainsNeutralNeutral
Feb 2018BMO CapitalMaintainsMarket PerformMarket Perform

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