Mylan rises as company details its guidance
NEW YORK (AP) — Shares of Mylan Inc. climbed to an all-time high Friday after the generic drugmaker's outlook over the next five years pleased investors.
THE SPARK: Mylan expects net income to reach at least $6 per share in 2018, more than double its estimate for 2013, and projects revenue growth of about 13 percent per year through 2018.
The company on Thursday predicted earnings of $2.75 and $2.95 per share this year, excluding special items, and 19 percent growth in 2014. That implies profit of $3.39 per share.
FactSet says analysts expect Mylan to report per-share earnings of $2.87 this year and $3.30 in 2014.
The company's revenue guidance for next year also topped Wall Street predictions
THE BIG PICTURE: Mylan is one of the world's largest generic drug companies and has been growing internationally through acquisitions. For example, it agreed in February to buy an Indian company, Agila Specialties, for $1.6 billion. Agila makes generic versions of injectable drugs.
Mylan says it is benefiting from increased use of generic drugs around the world and will keep looking for acquisitions.
The Canonsburg, Pa., company also handles the U.S. marketing of EpiPen, which treats severe allergic reactions.
THE ANALYSIS: Morgan Stanley analyst David Risinger on Friday upgraded Mylan's shares to "Overweight" from "Equal-weight" and set a $41 price target on the stock, saying shares could almost double over four years if investors believe in the company's outlook.
Mylan's stock is a good buy at its current price given the possibility that U.S. regulators will approve some of its drugs for sale soon, said Susquehanna Financial Group analyst Andrew Finkelstein. He has a price target of $39 and a "Positive" rating on Mylan stock.
SHARE ACTION: Mylan shares picked up $2.13, or 6.3 percent, to $36.11 in afternoon trading. The shares peaked at $36.77 earlier in the day. The stock had already gained 24 percent this year.