Anglo-Jordanian Hikma Pharmaceuticals plc (OTCPK:HKMPY)
has had some curious ups and downs over the past two years. The company
contemplated selling its injectables business (and got bids) only to
decide to keep it, and the company's U.S. oral generics business was
hurt by a warning letter in 2012 only to see a shortage of doxycycline
in the U.S. lead to significant revenue and profit growth.
Hikma
is going to be hard-pressed to maintain that momentum in doxycycline,
but this remains a business with some strong growth potential. Not only
is Hikma looking to leverage its position as the leading local
manufacturer of branded generics for the Middle East and North African
markets, but the company has begun to expand into other emerging
markets. Although the stock carries an EV/EBITDA multiple that is
demanding but not unreasonable, the price looks a little steeper on a
discounted cash flow basis. Growth-oriented investors may find something
to like here, but I suspect most value-oriented investors will give
this one a pass.
Please read more here:
Hikma Has Strong Growth Potential, But High Expectations
No comments:
Post a Comment