LONN SW

Lonza Group AG

Healthcare


Presented:07/25/2017
Price:CHF231.10
Cap:$13.73B
Current Price:CHF537.40
Cap:$38.43B

Presented

Date07/25/2017
PriceCHF231.10
Market Cap$13.73B
Ent Value$11.35B
P/E Ratio43.54x
Book ValueCHF41.32
Div Yield1.19%
Shares O/S57.19M
Ave Daily Vol506,977
Short IntN/A

Current

PriceCHF537.40
Market Cap$38.43B
Lonza Group AG engages in the supply of pharmaceutical, healthcare, and life science products. It operates its business through the Pharma&Biotech and Specialty Ingredients segments. The Pharma&Biotech segment deals with the supply of pharmaceutical ingredients and biopharmaceuticals as well as research and testing products and services. The Specialty Ingredients segment focuses on the solutions that promote health, wellness, beauty, nutrition, and hygiene and materials protection. The company was founded in 1897 and is headquartered in Basel, Switzerland.

Publicly traded companies mentioned herein: Catalent Inc (CTLT), Lonza Group AG (LONN VX), Patheon NV (PTHN), Samsung Biologics Co Ltd (207940 KS), Thermo Fisher Scientific Inc (TMO)

Highlights

Lonza Group appears to be at the nexus of several inflection points, including a major shift from small molecule drugs to large molecule therapeutics (biologics), a shortage of capacity in the industry, and an increasing reliance on contract manufacturing organizations (CMOs). With the stock at CHF 214/share following the acquisition of Capsugel, which was completed on July 5, 2017, the presenter views the risk/ reward setup as favorable. He is long, and if the stock can trade at 20x his CHF 13.50/share 2019 earnings forecast (versus the Street at CHF 12.70/ share), then investors should see a 25-30% gain up to CHF 270 over the next 12 months. Please note, the company reported earnings on July 26, 2017, and its Half-Year Results Presentation is available here for reference.

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Idea Discussion

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