Shore Capital has reiterated its buy recommendation on GSK PLC (LSE:GSK, NYSE:GSK) with a fair value of 2,500p, arguing the pharmaceutical group's shares are too cheap given the scale of its growth ambitions and that two of the market's main concerns about the business are beginning to fade.
The broker's analyst, Dr Sean Conroy, said GSK, which has a market capitalisation of around £79 billion, trades at 14 times his 2026 earnings estimate and 12 times his 2027 forecast, a level he described as undemanding relative to peers on comparable growth.
The two clouds that have weighed most heavily on the stock, namely fears around HIV patent expiries and uncertainty about the vaccines business, both showed signs of clearing this week.
On vaccines, a US federal judge ruled last week that the reconstitution of the Centers for Disease Control's Advisory Committee on Immunization Practices (ACIP) was likely unlawful, and that changes to the US childhood immunisation schedule had been made without following required scientific and advisory processes.
Shore Capital said the ruling could help to remove a headwind that had weighed on GSK's hepatitis, rotavirus and meningococcal vaccine franchises, all of which had been exposed to what the broker characterised as an anti-vaccine agenda pursued by Health Secretary Robert F. Kennedy Jr.
On HIV, Shore Capital pushed back firmly against what it called the "bear argument" that an insurmountable patent cliff will eventually derail the group's ViiV Healthcare subsidiary, arguing the threat is better described as a glidepath.
The broker said management commentary from the recent full-year results call pointed to a more bullish internal view on the long-acting injectable pipeline than had previously been disclosed, with the potential for a twice-yearly HIV treatment, known as Q6M, to address 50% of the treatment market and generate around £10 billion in annual sales in the early 2030s.
Shore Capital noted this scenario is not included in GSK's existing £40 billion 2031 revenue ambition, and that a successful Q6M regimen would represent material upside to current consensus.
Development milestones are approaching, with GSK indicating it remains on track to begin Phase IIb development for Q6M before the end of 2026, ahead of an "HIV meet the management" event scheduled for June at which it is expected to outline its plans in detail.
Shore Capital forecasts £4.3 billion in injectable HIV sales by 2031, ahead of consensus at £3.4 billion, supported by a less aggressive assumption for generic erosion of dolutegravir, GSK's current flagship oral HIV medicine.
The broker also highlighted the imminent launch momentum of cancer drugs Blenrep and Exdensur, each of which GSK believes could generate more than £3 billion in peak sales, as a further catalyst for consensus upgrades through the course of this year.
GSK shares have fallen 13% over the past month, a move Shore Capital described as disproportionate to the underlying fundamentals.