CTLT

Catalent Inc.

Healthcare


Presented:09/26/2019
Price:$48.53
Cap:$7.10B
Current Price:$60.66
Cap:$11.01B

Presented

Date09/26/2019
Price$48.53
Market Cap$7.10B
Ent Value$11.20B
P/E Ratio54.22x
Book Value$11.54
Div Yield0%
Shares O/S146.26M
Ave Daily Vol757,722
Short Int3.89%

Current

Price$60.66
Market Cap$11.01B
Catalent, Inc. is a holding company, which engages in the provision of delivery technologies and development solutions for drugs, biologics, and consumer and animal health products. It operates through the following segments: Softgel Technologies; Biologics and Specialty Drug Delivery; Oral Drug Delivery; and Clinical Supply Services. The Softgel Technologies segment formulate, develop, and manufacture services for soft capsules. The Biologics and Specialty Drug Delivery segment develops and manufacture services for blow-fill-seal unit doses, prefilled syringes, vials, and cartridges; analytical development and testing services for large molecules; inhaled products for delivery via metered dose inhalers, dry powder inhalers, and intra-nasal sprays. The Oral Drug Delivery segment focuses in the formulation development and manufacturing technologies, and related solutions including: clinical development and commercial manufacturing of a range of oral dose forms, including proprietary fast-dissolve Zydis tablets and both conventional immediate and controlled release tablets, capsules, and sachet products. The Clinical Supply Services segment includes packaging, labeling, storage, distribution, and inventory management for drugs and biologics in clinical trials. The company was founded in April 2007 and is headquartered in Somerset, NJ.

Publicly traded companies mentioned herein: Catalent Inc (CTLT), Lonza Group AG (LONN SW), Sarepta Therapeutics Inc (SRPT)

Highlights

The presenter is long shares of Catalent (CTLT) at ~$50 per share and sees a strong risk/reward setup following the recent Paragon BioServices transaction. He models ~40% upside to $72 per share, as he expects its 2020 EBITDA multiple to expand from 14x to 20x as investors appreciate Catalent’s newly acquired business lines. Additionally, there is meaningful upside above this price target through optionality on new Sarepta Therapeutics approvals.

For context, CTLT’s business mix is as follows: 

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Idea Discussion

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