We are upgrading Regeneron Pharmaceuticals ( REGN ) to Outperform from Neutral ahead of its second quarter earnings results slated for July 25. Regeneron, which turned a profit in the first quarter of 2012, should continue performing well throughout 2012, driven by excellent growth prospects of Eylea.
We have increased our 2012 earnings estimates by $0.17 to $1.07 per share. Moreover, with three action dates and multiple pipeline related news lined up, the remainder of 2012 promises to be exciting for Regeneron, with a scope for significant stock price appreciation.
Consequently, we believe that the current price represents an attractive entry point for long-term investors. Based on 2012 sales estimates, the stock is trading at 10.8x, compared to the industry average of 4.2x. Our price target of $145.00 is based on P/S of 13.0x our 2012 sales estimate.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.