Proactive Investors - Run By Investors For Investors

UDG Healthcare on the mend as RBC Capital kicks off coverage with an ‘outperform’ rating

UDG shares have lost a third of their value over the past year, but RBC reckons the sell-off, while justified initially, has been overdone
pills
RBC has set a price target of 800p per share, 20% above where the stock currently sits

Mid-tier Canadian investment bank RBC Capital has initiated coverage of pharma marketing specialist UDG Healthcare PLC (LON:UDG) with an ‘outperform’ rating.

UDG shares have fallen by a third over the past 12 months, which RBC puts down to “headwinds to individual businesses”, although analysts there think the sell-off now looks “overdone”.

READ: UDG Healthcare sells non-core Aquilant division and reviews Ashfield business

“With improving profit quality mix only set to continue and visible tailwinds this looks like a good time to take advantage,” they wrote in a note to clients.

When UDG reports its full-year results at the end of this month, the number crunchers reckon they should show a 1.3% rise in underlying earnings (EBOT). Growth is then expected to pick up to 3.9% next year, before heading up to 8.5% in 2020.

The RBC analysts note that UDB trades at a 20% discount to its peers, but are convinced that valuation is set to improve. Alongside their ‘outperform’ rating, they have kicked off with an 800p price target – some 20% higher from where the shares currently sit.

In late-morning trading, the stock was up 2.6% to 660p.

View full UDG profile View Profile

UDG Healthcare Timeline

Related Articles

1542204301_heart.jpg
November 14 2018
The goal of the program is to extend the visualization extracted from 2D ultrasound images and visualize 4D images
glasshouse
January 08 2019
Its plans to become a first-mover seed-to-consumer business here in the UK, following the model pioneered in Canada
scientist looking through microscope
April 11 2018
Kumaraguru Raja sees “multiple catalysts” in the year ahead which could put a rocket under the share price

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use