Citi reiterates 'buy' on AstraZeneca, says new drugs under-appreciated

11 September 2019

(Sharecast News) - Citi reiterated its 'buy' rating AstraZeneca on Wednesday, lifting the price target to 10,000p from 7,000 as it said the market continues to under-appreciate the commercial potential and operating leverage from drugs such as Tagrisso, Lynparza, roxadustat and Farxiga.
The bank's rating on AstraZeneca, which has been Citi's preferred global pharma major for the last five years, was reiterated for another year.

As well as upping its price target, Citi increased its earnings estimates 4-16% from 2023, putting it 28% above consensus.

"On Tagrisso, ADAURA and FLAURA2 will drive material increases in treatment duration and market size," it said.

"On Lynparza, we are excited by the potential in prostate, SCLC, NSCLC and tissue agnostic indications. On Farxiga, recent data validates our long held conviction on cardio-metabolic potential."

Citi added that the regulatory outlook for Roxadustat remains encouraging following discussions with biostatisticians.

At 1055 BST, the shares were up 0.6% at 6,890p.