Analyst Eric Le Berrigaud of Stifel Nicolaus maintained a Hold rating on GlaxoSmithKline (GSK – Research Report), with a price target of p1,640.00.
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Eric Le Berrigaud’s rating is based on a combination of factors that paint a mixed picture for GlaxoSmithKline’s prospects. While the company reported fiscal year 2024 results that slightly surpassed expectations, its vaccines division underperformed in the last quarter. This was anticipated but still a concern given the concurrent challenges of resolving Zantac litigation and revitalizing the product pipeline. Despite these issues, GSK’s 2025 guidance was promising, suggesting potential growth even amidst adversities like healthcare reforms and increased tax rates.
However, the outlook beyond 2025 remains relatively average, with a projected core EPS CAGR of 8% over the next three years. Although this positions GSK decently within its sector, its growth and risk profile do not stand out compared to peers with stronger R&D components. Consequently, while there is an upside to the target price, other companies may offer more compelling investment opportunities, justifying the Hold rating. Overall, while GSK shows promise, the potential gains do not significantly outweigh the associated risks at this time.
In another report released today, Barclays also maintained a Hold rating on the stock with a £14.50 price target.