Can Shire find a cure for its ailments following Wednesday’s full year results?
The pharmaceutical and biotech firm had a rather sickly 2017. Opening at £46.66, the stock bounced between £44 and £50 for the first few months of the year, only for a more sustained slide to set in from the start of June onwards. This decline eventually saw Shire close out 2017 at £39, marking a 16% slump across 12 months.
Sadly for Shire things have only gotten worse since 2018 began. The market-wide turmoil contributed to its drop, with the company hitting a near 4 year nadir of £30.43 on February 9th. Shire PLC now sits at a current trading price of £31.36.
The firm’s last set of figure came back in October, when it revealed its third quarter results. Revenue rose 7% year-on-year to $3.7 billion, with a ‘robust demand’ for its immunology offerings countering the weaker performances from its genetic diseases and internal medicine divisions. The former’s problems were caused by a now-resolved ‘manufacturing interruption’ of the hereditary angioedema drug CINRYZE, while the latter arm suffered from the introduction of a generic competitor for its ulcerative colitis treatment Lialda.
Shire’s adjusted earnings per shares smashed forecasts, surging 20% to $3.81 against the $3.69 expected by analysts, while it swung to a net profit of $551 million having posted a Baxalta-related $386.8 million loss the year previous.
The company actually released another update at the start of 2018, one that severely disappointed investors and informed its New Year decline. Not only did Shire appears to cool on the idea of breaking up the company into listed-entities following a strategic review, it also stated that it wouldn’t meet its previously stated 2020 sales target of $20 billion, instead claiming the figure would be $17 billion to $18 billion.
Following that January blow, and subsequent slide, Shire could really do with some good news on Wednesday. Analysts are expecting Shire to post fourth quarter revenue of $4.01 billion, with the full year number falling somewhere between $14.88 billion and $15.10 billion. Any update on its pipeline will also be welcome.
Shire PLC (LON:SHP) has a consensus rating of ‘Buy’ alongside an average target price of £53.34.
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