“We apply a 63% EBITDA margin reported for to arrive at ~$630M (or ~8%) in 2018 estimated adj. EBITDA to be divested away. If we apply a 9x EBITDA multiple to these assets, we would arrive at a sale price of $5.67B, which could improve gross leverage to ~2.9x EBITDA, from 3.4x currently. This is likely aspirational, and it sounds as if management may be willing to divest these assets for even lower multiples, but will attempt to offset dilution via share buybacks. Management is targeting a net leverage ratio of 2.5x by 2020, and indicated that the company plans to use a portion of its sale proceeds towards new assets, so we expect another M&A wave from Allergan in the next 6-12 months. Going forward, mgmt. indicated the company would focus on commercial and scientific investments in its core areas: and CNS.”,” Mizuho’s analyst wrote.
A number of other equities research analysts also recently issued reports on AGN. Leerink Swann increased their price target on Allergan from $237.00 to $242.00 and gave the stock an outperform rating in a research report on Wednesday, February 7th. JPMorgan Chase & Co. set a $265.00 target price on Allergan and gave the company a buy rating in a report on Thursday, March 15th. Cantor Fitzgerald set a $191.00 target price on Allergan and gave the company a hold rating in a report on Friday, April 27th. Vetr cut Allergan from a strong-buy rating to a buy rating and set a $183.43 price target for the company. in a research note on Thursday, March 15th. Finally, Deutsche Bank reiterated a buy rating on shares of Allergan in a research note on Thursday, April 12th. Three analysts have rated the stock with a sell rating, seven have assigned a hold rating and fifteen have assigned a buy rating to the stock. The company has a consensus rating of Hold and an average target price of $212.15.
Allergan (NYSE:AGN) last posted its quarterly earnings data on Monday, April 30th. The company reported $3.74 earnings per share for the quarter, topping the consensus estimate of $3.36 by $0.38. Allergan had a positive return on equity of 8.53% and a negative net margin of 11.94%. The company had revenue of $3.67 billion during the quarter, compared to analysts’ expectations of $3.59 billion. During the same period in the prior year, the firm earned $3.35 earnings per share. Allergan’s revenue for the quarter was up 2.8% compared to the same quarter last year. sell-side analysts forecast that Allergan will post 16.06 earnings per share for the current year.
The company also recently declared a quarterly dividend, which was paid on Friday, June 15th. Stockholders of record on Friday, May 18th were given a dividend of $0.72 per share. The ex-dividend date was Thursday, May 17th. This represents a $2.88 dividend on an annualized basis and a dividend yield of 1.66%. Allergan’s dividend payout ratio (DPR) is currently 17.61%.
In other news, EVP William Meury sold 24,425 shares of the business’s stock in a transaction on Thursday, May 17th. The shares were sold at an average price of $154.59, for a total transaction of $3,775,860.75. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. 0.36% of the stock is owned by insiders.
A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Prosight Management LP bought a new position in shares of Allergan during the fourth quarter valued at about $16,031,000. Tower Research Capital LLC TRC raised its stake in Allergan by 479.7% in the fourth quarter. Tower Research Capital LLC TRC now owns 1,768 shares of the company’s stock worth $289,000 after buying an additional 1,463 shares in the last quarter. Arbor Wealth Management LLC raised its stake in Allergan by 92.8% in the first quarter. Arbor Wealth Management LLC now owns 13,846 shares of the company’s stock worth $2,137,000 after buying an additional 6,663 shares in the last quarter. Canyon Capital Advisors LLC raised its stake in Allergan by 248.4% in the fourth quarter. Canyon Capital Advisors LLC now owns 501,494 shares of the company’s stock worth $82,034,000 after buying an additional 357,559 shares in the last quarter. Finally, Vantage Financial Partners Ltd. Inc. raised its stake in Allergan by 23.8% in the fourth quarter. Vantage Financial Partners Ltd. Inc. now owns 6,250 shares of the company’s stock worth $1,018,000 after buying an additional 1,200 shares in the last quarter. Institutional investors and hedge funds own 79.16% of the company’s stock.
Allergan Company Profile
Allergan plc, a specialty pharmaceutical company, develops, manufactures, markets, and distributes medical aesthetics, biosimilar, and over-the-counter pharmaceutical products worldwide. It operates through US Specialized Therapeutics, US General Medicine, and International segments. The company offers a portfolio of products that provide treatment for the central nervous system, gastroenterology, women's health and urology, ophthalmology, neurosciences, medical aesthetics, dermatology, plastic surgery, liver disease, inflammation, metabolic syndromes, and fibrosis, as well as Alzheimer's disease.
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