Thursday, November 7, 2013

Seeking Alpha: Endo Health Scores A Huge Win

It really is a new Endo Health (ENDP).

I've gone on at length about how past management did their best to try to ruin a once-strong specialty pharmaceutical business, but the announcement of a deal to acquire Paladin Labs (OTC:PLDLF) is a true transformational deal in all of the right ways. Endo still has challenges to deal with, including generic competition for two major products and surgical mesh litigation, but the company seems to be handling the generic issue pretty well and the acquisition of Paladin will significantly expand the company's specialty pharma business and generate substantial tax savings by redomiciling in Ireland.

The only "but" is valuation. While I do believe that Endo Health's guidance on synergies are pretty conservative, the nearly 30% move in the shares is a pretty solid recognition of the value this deal will create. It's tough to buy a stock at an all-time high after such a big move, but the post-deal valuation doesn't seem unreasonable and Endo will still have the financial flexibility to do additional deals to rebuild the pipeline and patented product portfolio.

Please read more here:
Endo Health Scores A Huge Win

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