When the takeover bid for speciality pharma business Shire (SHP) by US firm AbbVie (US:ABBV) collapsed, shares in Shire plummeted 30 per cent. But this has left investors with a chance to buy Shire shares again, without the distraction of an imminent takeover. Now, Shire's growth potential as an independent company has a chance to shine through, and we like what we see.
- Strong product pipeline
- New credit facility
- Acquisitions boosting growth
- Vyvanse patent extension
- Collapsed takeover bid
- Punchy rating
Third-quarter results, which came out shortly after the deal fell through, were, in the words of City analysts, "exceptional". Sales rose 32 per cent and EPS jumped 60 per cent during the period. And management upgraded its EPS expectations for the full financial year to the "high 30 per cent range". This prompted broker Deutsche Bank to lift its EPS forecasts by 4 to 6 per cent annually, which means it now expects a hearty EPS compound annual growth rate of 18 per cent to 2018.