GSK - CMD Groundhog Day (13 pgs)
We have seen numerous Pharma co’s give L-T guidance that is ultimately missed, or muddied with M&A. GSK’s ambitious targets announced yesterday seem a stretch to us and despite stretching our own sales forecasts, we are below guidance on EBIT. We value GSK using a SOTP which fully encapsulates the ViiV patent expiry and the various pay-aways. Our £14.50 PT implies limited upside risk and requires material pipeline progress for any upside. We also believe there is considerable cannibalisation risk in the £20bn late-stage pipeline target and that GSK’s pipeline is materially riskier than peers.For access to the full note, please contact Naresh Chouhan ( )
GlaxoSmithKline is a global healthcare company. Co.'s segments include: Pharmaceuticals; Vaccines; and Consumer Healthcare. The Pharmaceuticals segment is focused on developing new medicines in respiratory, HIV, oncology and immuno-inflammation, with discovery research exploring these and other areas. The Vaccines segment has a portfolio and pipeline of vaccines to help protect people throughout life. Co. delivers vaccines to people living in over 160 countries. The Consumer Healthcare segment develops and markets consumer-preferred brands in oral health, pain relief, respiratory, nutrition/gastro-intestinal and skin health.
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