UBS has raised its target price for GSK PLC (LSE:GSK, NYSE:GSK) from £15.80 to £16, following a better-than-expected full-year earnings report and a focus on improving shareholder returns.
The pharmaceutical company’s 2025 guidance suggests 3-5% sales growth, despite anticipated weakness in vaccine sales and a £400-500 million impact from US healthcare reforms.
UBS upgraded its 2025 earnings per share (EPS) forecast by 11%, citing strong performance in oncology and specialty medicines, which have higher profit margins.
GSK’s £2 billion share buyback programme also helped lift earnings expectations, reinforcing confidence in its long-term growth outlook. The company now expects to exceed £40 billion in annual sales by 2031, though UBS remains more cautious, projecting £33.5 billion.
Deutsche Bank also revised its target price, increasing it from £13.50 to £14.50, following a solid fourth-quarter performance. The bank noted that GSK’s medium-term growth outlook remains unclear, particularly with vaccine sales under pressure and competition in the HIV market.
Stifel, meanwhile, maintained a £16.40 target price, stating that while vaccine sales were weaker than expected, the market had been too harsh on GSK.
It highlighted growing momentum in oncology and immunology but questioned whether the company’s long-term outlook was strong enough to justify a more optimistic stance, saying it had a 'hold' rating "because the outlook towards the turn of the decade still appears too average".
In late morning trading, the stock was flat at 1,491.5p.