Aspen Pharmacare Has Continued To Grow And Branch Out

It has been many years since I've updated my coverage on South Africa's Aspen Pharmacare (OTCPK:APNHY)(APNJ.J), but the intervening years have seen a lot of familiar themes. Management has continued to use M&A to expand its market reach and has continued to expand beyond South Africa, while organic growth has continued to be underwhelming relatively to perpetually rosy expectations from investors and most sell-side analysts.

Assessing the shares remains a difficult exercise. On one hand, the likely underlying discounted cash flow doesn't seem to support the share price, but that has long been the case and the shares have risen despite that (up more than 20% since my last article for the ADRs and up over 100% at the interim peak price). Aspen continues to offer rare access and potential to high-potential markets like China, Brazil, Indonesia, and Sub-Saharan Africa, but price controls and consumers' ability to pay remains a real concern. I expect that investors will continue to be willing to pay a premium for this emerging market pharma story, and the price isn't so unreasonable relative to EBITDA growth, but I would remain alert to the various macro challenges, as well as the sub-standard liquidity of the ADRs.

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Aspen Pharmacare Has Continued To Grow And Branch Out

Investopedia: Elan Continues To Make Baffling Strategic Decisions

When Elan (NYSE:ELN) announced back in February that it was selling its interests in Tysabri to Biogen Idec (Nasdaq:BIIB) my biggest concern was that Elan management would waste the proceeds. Elan management had made a series of questionable (if not bizarre) decisions prior to the Tysabri announcement, and I had minimal confidence that they would do the right thing – which, in my opinion, was simply to sell off the remaining assets and write a check to shareholders. Since then, the company's two major strategic decisions only reinforce my worries that Elan shareholders are not going to be well-served by management in the deployment of this cash.

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http://www.investopedia.com/stock-analysis/052113/elan-continues-make-baffling-strategic-decision-eln-thrx-gsk-prta-sny.aspx

Seeking Alpha: Aspen Pharmacare Offers Very Expensive Developing World Growth

Aspen Pharmacare (APNHY.PK) is likely to be a very frustrating stock to many SA readers. While this company may be one of the best publicly-traded plays on the growth of the healthcare markets in Africa, Latin America, and Asia, the stock already sports a very steep multiple. What's more, its ADR shares are incredibly illiquid in the U.S., and only the Johannesburg-traded shares (APNJ.J) offer much liquidity. But for investors who can be patient, an opportunity to acquire shares in this company could be one of those rare once-in-a-decade opportunities.

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Aspen Pharmacare Offers Very Expensive Developing World Growth