GSK PLC (LSE:GSK, NYSE:GSK) has received mixed reactions from City analysts despite an objectively strong third-quarter performance and raised financial guidance.
Shore Capital Markets praise the “stellar debut” of respiratory syncytial virus (RSV) vaccine Arexvy, which helped to drive up vaccine sales 13% over targets.
However, “there is likely an element of inventory build ongoing so we might expect to see a softer fourth quarter, but strong initial uptake here should bode well for sentiment around long-term expectations given it evidences strong commercial execution from GSK.
“We continue to highlight this vaccine has potential to surpass the Street’s initial expectations, as Shingrix did,” said ShoreCap.
Speaking of which, US momentum of shingles vaccine Shingrix “continues to temper”, according to ShoreCap, “but it was well flagged at the second-quarter results that sales in this market are likely beginning to plateau”.
ShoreCap provisionally edged up full-year 2023 forecasts by 3% to 4% following the results
Jefferies analysts retained a 'hold' position on GSK stock despite upgraded forecasts, pointing to Zantac US litigation overhang and the need for more in-licensing and bolt-on acquisitions.
UBS is less than neutral, offering a 'sell' rating with a 12-month price target of 1,310p against a publication price of 1,432p.
Another pending headwind for the British pharmaceutical giant is a patent expiry on blockbuster HIV treatments, though this is not until 2028.