This company has been on a mergers and acquisitions binge over the past three years, and it is a top pharmaceutical stock to buy. Mallinckrodt PLC (NYSE: MNK) is a global specialty biopharmaceutical and medical imaging business that develops, manufactures, markets and distributes specialty pharmaceutical products and medical imaging agents.
The company’s areas of focus include therapeutic drugs for autoimmune and rare disease specialty areas, like neurology, rheumatology, nephrology and pulmonology, as well as neonatal critical care respiratory therapies and analgesics and central nervous system drugs.
Top Wall Street analysts recently met with management and key takeaways were that U.S. health care policy change will be gradual, but the industry views greater price transparency, positively and MSD-LDD Acthar growth is supported by data build-out and volume gains. Stifel feels that Wall Street underappreciates the company’s pipeline, as clinical timelines for StratGraft and Terlipressin remain on track.
The $85 Stifel price target compares with the consensus target of $73.62. The stock closed Tuesday at $44.55 per share.
The stock was hit hard on earnings, but it may be a great but for speculative accounts looking for a bounce back. Horizon Pharma PLC (NASDAQ: HZNP) is a specialty pharmaceutical company based in Ireland, and through its subsidiaries, develops and commercializes medicines for the treatment of arthritis, pain and inflammatory diseases.
The company’s best known products include Actimmune for reducing the frequency and severity of serious infections associated with chronic granulomatous disease, and Duexis, a proprietary tablet formulation for the relief of signs and symptoms of rheumatoid arthritis and osteoarthritis.
The company missed market expectations on both the top and bottom lines in its first-quarter report. The company said revenues grew 7.9%, driven by strong growth from Horizon’s orphan and rheumatology business units, but offset by lower sales in the primary care business unit.
Horizon also has announced a deal to acquire River Vision Development and its development-stage medicine teprotumumab (RV001) for an upfront cash payment of $145 million, plus potential future milestone and earn-out payments contingent on the satisfaction of certain regulatory milestones and sales thresholds. The company anticipates a potential peak annual sales opportunity for teprotumumab, if approved, in excess of $250 million in the United States.
Stifel lowered its price target $20 from $35 but kept the Buy rating intact. The consensus target is $21.40, and the stock closed on Tuesday at $9.92.
These two very speculative biotechs and two specialty pharmas offer more safety and actual earnings. All four make sense for risk-tolerant accounts looking for some big alpha possibilities.