Hikma Pharma gets boost from Citigroup upgrade to ‘buy’ from ‘hold’ on growth outlook for 2019

Citigroup gave a boost to Hikma Pharmaceuticals PLC (LON:HIK) on Tuesday, upgrading its rating for the bluechip generics drugmaker to ‘buy’ from ‘hold’, highlighting opportunities to improve the growth outlook in 2019.

The US bank maintained its target price for the FTSE 100-listed firm at 1,870p, with the shares currently trading at 1,619.50p, up 1.8% on Monday’s close.

READ: Hikma Pharma falls as it narrowly misses forecasts with 2018 results

In a note to clients, Ciigroup’s analysts pointed to expectations for stronger underlying profitability at Hikma’s Injectables – which accounts for 40% of group sales and 62% of underlying earnings (EBIT).

They said their base case scenario for the group sees a compound average growth rate for sales of 5%, with margins increasing to 24%-25%.

In another note, fellow US broker Jefferies International repeated a ‘buy’ rating on Hikma shares but trimmed its price target to 1,960p, down from 2,000p previously.

Story by ProactiveInvestors