AstraZeneca PLC (LSE:AZN)'s positive data from Imfinzi’s Phase III ADRIATIC trial follows the raft of positive readouts and approvals across a range of cancer types, notes Shore Capital.
Already these have stimulated a strong uptick in sales momentum for its burgeoning IO (immunotherapy) franchise during 2023 ($4.24bn, +55% CER).
“With c.85% of the FY27F consensus forecasts for Imfinzi already attributable to its use for lung cancer, we don’t anticipate any significant upgrades based on these data alone.
“We view the opportunities outside of lung cancer as a more important source of near- to medium-term upgrades.
“Looking longer term, we highlight the trials looking at novel combinations designed to improve efficacy or address low PD-1 expressing cancers that could support upgrades for the broader IO franchise.”
Shore Cap adds that a clearer picture of how AZN will support its ambition of industry-leading revenue growth beyond 2025 should become more apparent following a capital markets day on 21 May.
“Ahead of this, we continue to see a quality growth story, underpinned by a broad blockbuster base and an enviable pipeline.
“A premium is warranted based on its earnings growth and pipeline prospects. Our FV of 13,000p/share implies c 17x is readily justifiable.”
Shares fell 1.5% to 10,578p.