The recent slide in the value AstraZeneca PLC (LON:AZN) shares is behind a change in stance by a City stock picker.
Liberum’s Roger Franklin has moved to ‘buy’ from ‘hold’ on the stock, which he reckons is worth £52 – that’s a full £10 higher than it’s currently trading.
The unwinding of bid speculation has meant AZ has lost around 15% of its value in the last six months.
In dollar terms, the pharma giant is now trading at levels last seen three years ago when the outlook for the business was a lot less optimistic.
Franklin also points out the current price is factoring in ‘zero success’ from a clinical trial of a new and potentially lucrative lung cancer drug.
“The shares will be temporarily weak if it [the trial] fails but earnings and fundamental value means we would still see longer-term upside,” the analyst said in a note to clients.
Of the 16 analysts logged by the Broker Forecasts website as following AZ, ten are bullish and two are ‘sellers’ of the stock. The remainder reckon it is fully valued.
The consensus price target, meanwhile, has gone up over the last six months to £52.90 from £48.11 six months ago.
Currently, AZ is changing hands for £42.64.