Judging by the way the share price was up & down today brokers weren't sure if the update was good or bad. My view was it was on balance good, showing steady progress; and I think markets edged higher as the end of the day approached so I think they agreed.
They may have been oversold, but it is all one way traffic at the minute. The MM will have their fun, suck a few more in, pull the plug, repeat. I can see no imperative to jump in at this level, though I would not deter anyone.
I have been lucky and in 50yrs of 70% of the time buying purely on director dealing have made money but this is one of my worst purchases ever considering the millions dir. spent
We have 4 broker down grades & 1 buyer saying fall over done just holding on good luck all
Injectables is their largest business is doing well.
Branded has got a bit of a forex headwind, and these things happen with international businesses, but usually what is a headwind one year is a tailwind the next.
Generics is the main problem area; but it is still profitable (albeit just) and there are some potential juicy new product launches in the offing.
Going back to March (its recent high) the company was probably valued as too much of a growth business; and some of the fall in the share price is a reasonable re-rating; but things don't look bad.
Numis issuing a cautious buy & Deutsche Bank buying recently are good signs; and maybe all those stop losses being triggered today, may be finding their way to a thankful buyer.
What's the 'fundamental problem', personally, I can't see it. Company just hasn't grown its revenues/profit as people had come to expect. As I said earlier, the company is trading at 2016 levels.........it's not as if it's making a loss!!
Spike down today definitely caused by stop losses triggering, leading to a 5% gain on the day from the 10% bottom. Although I'm down on the stock, at least managed a long 48pt spreadbet during the course of the day
Wow - so negative. This was hardly a profit warning. Sure generics are under pressure, but the other parts of the business are holding up well - despite the Egyptian pound falling. As for a dead cat bounce, you are surely not suggesting Hikma is any trouble. Can I quote the penultimate sentence of the T/A . . .
The Group continues to generate good cash flow and has a strong balance sheet, which provides strategic and financial flexibility.
Finally, I note Numis now have issued a (cautious) buy note with a target of 1300p.
Anyway, I am not complaining - managed to top up again at a good price.
SP has halved over 6 months. This is not an over-reaction, it is a recognition that there is a fundamental problem. Yes , there may be a dead cat bounce tomorrow or Monday but it is all too risky for ordinary investors
And another thing. I have just noticed on L2 that almost all trades today have been automatic - I am presuming stop losses triggering. When the analysts give this the once over again on fundamentals I think we will see a good SP recovery.
I really don't understand. Injectables on a high, branded doing OK and generics a little further down. Result more or less the same. This is a well balanced stock with more to its operation than generics. There is no justification for the fall in SP, so I am topping up!
"Not sure the Yield is 3% - that's what ii have it at"
You're quite right. ii's yield figure is a simple calculation of the full year dividend divided by the current share price. However the figures ii quote on their fundamentals page are shown as GBP but are actually the $ figures.
Last year's FYD was 33c, so taking an exchange rate of 1.32 & last night's closing price of 1054 we'd get a yield of 2.38%
All the hype surrounding this share seems to have evaporated. This seems a more realistic level. I cannot see any good reason for buying now, though they probably represent fair value, always assuming there are no more banana skins. One to mull over, again!
This is one share which needs a positive update on Thursday. It seems to have become one of the most unloved shares on the LSE, to such an extent that it's beginning to look like a good value share - yield over 3%, PE around 15. Gone are the days of it being priced for rapid growth.
I know capacity does not equal sales, but surely the company is telling us there is a LOT of further potential in injectables - currently the biggest and most profitable part of the company. I would not be surprised to see a MAJOR jump in profits in the next two years and for me, this is a belting investment at this price.
Yes they can charge what they like, BUT the healthcare insurance companies can direct that a much cheaper alternative is used/supplied. The price hike strategy can backfire dramatically and they can end up losing what they already have.
Hikmas US unit sharply raises prices of several drugs
West-Ward increase cost of medicines by as much as 430%
Hikma, the London-listed generic drugmaker, has sharply increased the price of a string of medicines in the US including a diarrhoea treatment that has risen 430 per cent in the latest instance of gouging.
West-Ward Pharmaceuticals, the US division of Hikma, raised the price of six of its drugs at the start of the month by between 75 per cent and 430 per cent, according to figures seen by the Financial Times. The mean increase was 237 per cent.
"Hikma shares only optically cheap, says Peel Hunt
Shares in Hikma Pharmaceuticals (HIK) fell after the company lowered its guidance for 2017 generics sales which Peel Hunt said would weigh despite the shares remaining optically cheap.
Analyst Amy Walker retained her hold recommendation and target price of £21.50 on the stock after it trimmed its guidance for 2017 revenue to $2 billion due to a weaker outlook for the generics business.
The news sparked a 9.9% slump in the shares to £11.92 yesterday.
Walker said she was likely to cut her 2017 earnings expectations for the group by 7%.
Investor sentiment on generics remains subdued and though Hikmas valuation is undemanding, we see few catalysts for outperformance given lingering worries over the mid-term outlook, she said.
Walker also noted a lack of news on the launch of its generic asthma drug, a version of GlaxoSmithKlines Advair treatment.
Though Hikma remains optically cheap despite the implied forecast cuts, we expect [the] results to continue to weigh on sentiment, and we remain at hold, she added."
I don't understand a target of £21.50 with a HOLD rating.
The overall picture for generic companies, however, remains gloomy. In the words of one analyst: When you have that combination of oversupply and consolidation on the demand side, it's a recipe for catastrophe. (FT, WSJ)
"Hikmas share price can be wildly volatile on any given day over and above the drug companys ability to hand out shocks to its investors. Admittedly the latest, that the company is facing increasing competition in the market for generic drugs in the US, should not have come as a surprise.
Others in that market, such as Teva Pharmaceutical of Israel and Mylan, Hikmas rival in developing a generic form of Glaxosmithklines Advair asthma blockbuster, have already indicated this. The US Food and Drug Administration has every reason to try to get cheaper generics to the market quickly with healthcare budgets under pressure.
Yet the shares fell 139p to £11.90. The statement over that Advair generic is bland enough, even if Mylan is a few weeks ahead of Hikma in gaining approval. Glaxo was being cautious earlier this year over Advair, but even if competition had come this summer it was still forecasting sales of £1 billion for the compound so the market is big enough for two rivals even before you factor in the prospects of further sales in other markets such as China.
Hikma shares sell on about 14 times this years earnings, historically low. Existing investors should hang on, though a buy looks speculative.
MY ADVICE Hold
WHY Shares are back a long way but uncertainties remain"
I've never known Hikma so cheap by PE, Price/book, or offer such a high yield; and although it's going through a tricky phase, there is still a lot of potential growth. (I'm still glad they've dropped the "fast growing" from the opening of all news releases.)
Debt is coming down too.
I think I'll give it a few days to find its bottom before piling in though.
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