It feels a little after the Lord Mayor’s show, but Deutsche Bank believes it stumbled over a reason to buy shares in GlaxoSmithKline PLC (LSE:GSK), which have advanced 26% already over the last year.
So, anyway, in its note on Thursday, DB homes on the vaccines business, which it thinks has the potential to deliver the long-term growth analysts and investors reckon is missing from the GSK story.
“Here, the return to robust growth for Shingrix [as shingles vaccine] has potential to be significantly complemented by a novel geriatric RSV vaccine franchise,” the German bank said.
RSV, or respiratory syncytial virus, is a mild cold-like virus that can develop into a serious ailment for infants and the elderly.
A number of companies have been developing a jab for RSV, a market that’s expected to grow to US$4bn over the next five years, according to research firm Fortune Market Insights.
The odd thing about DB’s ‘buy idea’ is it is accompanied on the brief note itself with a ‘neutral’ recommendation, which is a tad confusing.
The share price target, meanwhile, has been lifted to 1,750p a share from 1,600p.
The stock was down 1.8% at 1,723p as GSK succumbed to the turmoil and uncertainty that crept across the Atlantic overnight.