Mallinckrodt Shares Rally As BMO Initiates At Outperform

Still in the target of short sellers, Mallinckrodt PLC MNK got a positive note from the sell-side coverage Wednesday morning. BMO Capital Markets initiated the specialty pharmaceutical name with an Outperform rating and $84 price target.

The four parts of their outperform thesis for Mallinckrodt where:

• Execution of driving increasing volume growth in specialty branded assets through M&A, including: Acthar, INOmax, Therakos, Ofirmev
• Acthar stability with payers and further growth strategy with enhanced promotional efforts and data set.
• Underappreciated hospital business that continues to grow and achieve better scale with durable revenue.
• An attractive valuation relative to earnings power, with ability to continue solid cash flow generation.

With low sector expectations, BMO believes Mallinckrodt provides an investment opportunity as the sector has seen a recent downturn.

Shares of Mallinckrodt were trading up 6.69 percent at $59.99.