AstraZeneca: UBS maintains 'sell' rating as rumours fly
(CercleFinance.com) - UBS maintains its "sell" rating on AstraZeneca, with a target price of 7,300 pence, after Bloomberg reported that the British drugmaker has approached its smaller peer Gilead for a potential merger.
"At first sight that seems somewhat strange given there is hardly any therapeutic (Gilead is mainly antivirals) and strategic overlap between the companies," the broker wrote in a note to clients.
"However, Gilead has what AstraZeneca doesn't - a lot of cash (24 billion dollars as of the first quarter)," it pointed out.
With AstraZeneca looking for cash and Gilead needing a pipeline (which AstraZeneca has), there could be some strategic sense in such a deal, UBS said.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
"At first sight that seems somewhat strange given there is hardly any therapeutic (Gilead is mainly antivirals) and strategic overlap between the companies," the broker wrote in a note to clients.
"However, Gilead has what AstraZeneca doesn't - a lot of cash (24 billion dollars as of the first quarter)," it pointed out.
With AstraZeneca looking for cash and Gilead needing a pipeline (which AstraZeneca has), there could be some strategic sense in such a deal, UBS said.
Copyright (c) 2020 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.