Credit Suisse Sets Bearish Tone For Amgen; Says Current Setup Not Ideal For Growth

Credit Suisse Sets Bearish Tone For Amgen; Says Current Setup Not Ideal For Growth
  • Credit Suisse has initiated coverage on Amgen Inc AMGN with an Underperform rating and a price target of $240.
  • The analysts say that Amgen has had a solid year, with the stock up c.25% year to date, recently driven by early clinical readouts. 
  • Related: Amgen's Olpasiran Reduced Cholesterol Levels In 95% Of Patients In Mid-Stage Study.
  • But, the firm believes management's current setup for growth could be better. The company has guided for a 2022-2030 mid-single-digit revenue CAGR (CSe-1%). This is viewed as an aspirational goal, and do not see the new growth drivers (Lumakras, Tezspire) or the pipeline offsetting the eroding base business revenues. 
  • Credit Suisse expects additional growth from M&A for Amgen to achieve its target, but meaningful deals could be challenging given the cash commitments for a >60% dividend payout ratio and continued share repurchases. 
  • Price Action: AMGN shares are down 0.40% at $286.16 on the last check Friday.

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