Lonza Tied To Attractive Markets

Lonza (OTCPK:LZAGY) has done well since I last wrote about this Swiss specialty chemicals company, with the shares up 100% as the company has continued to see solid performance in both its pharma/bio and specialty chemical operations. While the acquisition of Capsugel is a big one, the expansion into finished oral doses (hard capsules) for the pharma/consumer health industries makes sense and should add value despite a hefty price tag.

Lonza's shares are a so-so value proposition, and there are risks that Capsugel's expense structure won't offer as many synergy opportunities as hoped. That said, the growth opportunities in biologicals, ADCs, advanced pharmaceutical ingredients, cell therapies, nutriceuticals, and hygiene are significant and can support today's valuation.

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Lonza Tied To Attractive Markets