reports
- Dominic Rose
- Naresh Chouhan
Sandoz - 400bps H2 Margin Improvement (BUY, TP CHF46 11pgs)
As investors continue to fret about H2 performance, we analyse the building blocks of 2H24 sales & EBITDA progression as well as the building blocks of our 17% EBITDA growth in 2025. Now that we know the Q4 generics launch is paclitaxel, we model its contribution & we also now have greater visibility on the Hyrimoz (biosimilar Humira) scrip trends. A combination of cost savings, mix effects, paclitaxel stocking & operational leverage should all add up to a 400bps improvement in the H224 EBITDA m...
- Dominic Rose
- Naresh Chouhan
Sandoz - Defensive Growth - Multiple Upside Drivers (BUY, TP CHF46, 14...
Our deep dive into the EU generics business and biosimilar pipeline highlights a truly defensive business, with significant and growing barriers to entry. We believe that as more analysis is done on Sandoz and the company becomes more confident on US biosimilar commercialisation, EPS upgrades will ensue, leading to further re-rating. For context, SDZ trades on 10.5x EBITDA today for cons. EBITDA growth of 11% CAGR 2024-28. Compare that to Stedim (SELL) on 27x EBITDA for a similar 14% EBITDA CAGR...
- Dominic Rose
- Naresh Chouhan
Sandoz - Transitioning to Specialty Pharma (BUY, TP CHF46 [37], 20 pgs...
Following a deep-dive on the Biosimilars business we show that Sandoz is transitioning to something that looks more like a Specialty Pharma company as Biosimilars become ~40% of profit. We are now 12% above 2029 consensus EBITDA as we add 3 new biosims to our forecasts but highlight many more that could be added to forecasts. We show there is 500bps margin improvement to 2029 & 12% CAGR EBITDA growth driven by biosimilars. We also show why the EU generics market has high barriers to entry & coup...
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