Few Healthcare Stocks to Ponder on: Verona Pharma, Allergy Therapeutics and Hikma Pharmaceuticals

Few Healthcare Stocks to Ponder on: Verona Pharma, Allergy Therapeutics and Hikma Pharmaceuticals

Verona Pharma PLC

UK based, Verona Pharma PLC (LON: VRP) is a clinical-stage biopharmaceutical group, which specialises in the commercialisation and development of innovative medicines which are available for sale with prescription only, meant for the treatment of respiratory diseases with unmet medical urgencies, such as chronic obstructive pulmonary disease (COPD), asthma, and cystic fibrosis. The group is quoted on the Nasdaq Global Market with ticker symbol VRNA in the United States. In the United Kingdom, the group is quoted on the London Stock Exchange with ticker symbol VRP.

The company looks forward to ace projects with the deep potential to create value for shareholders in the long-term horizon. Millions of patients suffer from chronic respiratory diseases across the world. These disorders cannot be cured by existing medicines or treatments. The company has identified this issue and looks forward to developing these treatments through efficient R&D outsourcing model, which provides access to leading organisations and experts across the world.

The company has a fair understanding of the need of the hour in terms of medical advancement and commercial leverage it can reap on its products portfolio in the multi-billion-dollar markets internationally. With partners and investors belief in the company’s strategy, making the appropriate decisions at the right time will not only help the company finds it way for commercial success but also help in transforming several lives suffering from these chronic diseases.

VRP presented at Jefferies 2019

The group presented at Jefferies 2019 London Healthcare Conference on 20th November 2019. This conference, one of the largest conferences in Europe, focused on healthcare, and this year was its 10th anniversary. The conference saw good participation from pharmaceuticals, biotechnology, generic medical technology and other related healthcare sectors from across the world. Last year, around 500 participants were there at the conference.

VRP-Financial performance for the nine-month period ended 30th September 2019

(Source: London Stock Exchange)

The company’s short-term investments, Net cash and cash equivalents were recorded at £41.1 million as on 30th September 2019 as compared to £64.7 million as on 31st December 2018. The company incurred an operating loss of £33.7 million for the nine-month period in contrast to £18.3 million in the nine-months period ended in September 2018. The company’s loss per share (reported) stood at 23.3 pence during the period.

VRP- Stock price performance

Daily Chart as on Nov-28-19, before the market close (Source: Thomson Reuters)

On 28th November 2019, at the time of writing (before market close, GMT 11:15 AM), VRP shares were trading at GBX 44.00, down by 1.12 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 117.64/GBX 39.60. At the time of writing, the share was trading 62.59% lower than its 52w High and 11.11% higher than its 52w low. Stock’s average traded volume for 5 days was 38,876.00; 30 days - 39,831.57 and 90 days - 72,100.19. The average traded volume for 5 days was down by 2.40% as compared to 30 days average traded volume. The outstanding market capitalisation was around £46.87 million.

Allergy Therapeutics PLC

Allergy Therapeutics PLC (LON: AGY) is known for developing immunity-based products for treatments related to allergy disorders. The Research & Development department of the company aims to capitalise on its specialist experience to develop products which can eliminate the root cause of the disease instead of diagnosing symptoms. The company claims to develop Aluminium free products, that can cure the disorders in limited time and are convenient to use. The company follows a disruptive strategy and aims to provide breakthrough innovation in the field of allergy and immune system- related disorders. The company has a strong presence across Europe, Germany, Italy, Switzerland, Spain and the United Kingdom. The company also has a presence in Canada, Czech Republic and Slovakia indirectly.

AGY to commence Grass MATA MPL phase III clinical programme

The company’s Grass study, which is due to start in Autumn 2020, will be done in two stages spanning both the pollen seasons of 2020/2021 and 2021/2022. Post commencement of phase III-scale study begins in the 2020/2021 season, an interim review shall be conducted to gain insights into the trial before the company moves forward to the second part of the study.

AGY-Financial performance

(Source: London Stock Exchange)

The revenue of the company increased by 8 per cent to £73.7 million in the fiscal year 2019 in contrast to £68.3 million in the fiscal year 2018. The net profit of the company was recorded at £3.5 million in the fiscal year 2019. The gross margin of the company remained unchanged in the fiscal year 2019 and stood at 75 per cent, as of the fiscal year 2018. Cash balances of the company were recorded at £27.4 million as on 30th June 2019.

 

AGY-Stock price performance

Daily Chart as on Nov-28-19, before the market close (Source: Thomson Reuters)

On 28th November 2019, at the time of writing (before market close, GMT 11:19 AM), AGY shares were trading at GBX 11.50, up by 6.97 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 15.75/GBX 7.30. At the time of writing, the share was trading 26.98% lower than its 52w High and 57.53% higher than its 52w low. Stock’s average traded volume for 5 days was 221,965.60; 30 days - 95,195.47 and 90 days - 206,466.84. The average traded volume for 5 days was up by 133.17% as compared to 30 days average traded volume. The company’s stock beta was 0.77, reflecting lower volatility as compared to the benchmark index. The outstanding market capitalisation was around £68.09 million.

Hikma Pharmaceuticals PLC

Pharmaceutical company, Hikma Pharmaceuticals PLC (LON: HIK), is centered on manufacturing, developing and marketing of an array of generic medicines (both branded and no-branded) and third party contracted medicines. These generic medicines (both branded and no-branded) and licensed medicines are patented and sold across the MENA (The Middle East and North Africa) region and other markets. Generic injectable products of the company are popular across the world. In addition, the company sells non-injectable generic products in the United States, with a range of 260 plus products in different forms and dosage. Arab Medical Containers, the company’s other business segment, is a manufacturer of specialised plastic sterile containers used for medical purposes.

Hikma’s response to FDA submitted for generic Advair®

The company submitted its response to the Food and Drug Administration (FDA) in the United States, after receiving a complete response letter (CRL) from the regulator regarding the deficiencies in its abbreviated new drug application (ANDA) for a generic version of GlaxoSmithKline's Advair Diskus®.

The company initiated a clinical endpoint study in 2018 after receiving the CRL. The study was completed, and the results were submitted to the FDA along with additional information. The study results talked about the FDA’s questions asked in the CRL.

The company has worked extremely hard with Vectura to complete this clinical study, which proves the safety and effectiveness of the product. The company looks forward to developing its pipeline of generics further. The company aims to bring the generic version of Advair® into the US market.

HIK released a trading statement on 7th November 2019

The company is expecting its global injectables revenue to be in the range of $870 million- $900 million in the fiscal year 2019 and the core operating margin to be in the bracket of 36-38 per cent.

The company expects the revenue from Generics to be in the bracket of $690 million-$720 million for the fiscal year 2019 and core operating margin to be in the range of 16-18 per cent.

The company expects the revenue growth from the Branded segment in mid-single digits (at constant currency) for the fiscal year 2019. The company is expected to release its results on 27th February 2020 for the fiscal year 2019 period ended 31st December 2019.

HIK-Stock price performance

Daily Chart as on Nov-28-19, before the market close (Source: Thomson Reuters)

On 28th November 2019, at the time of writing (before market close, GMT 11:23 AM), HIK shares were trading at GBX 1,937.00. Stock's 52 weeks High and Low is GBX 2,212.00/GBX 1,491.50. At the time of writing, the share was trading 12.43 per cent lower than its 52w High and 29.86 per cent higher than its 52w low. Stock’s average traded volume for 5 days was 334,223.60; 30 days - 363,922.87 and 90 days - 510,262.94. The average traded volume for 5 days was up by 8.16% as compared to 30 days average traded volume. The company’s stock beta was 0.86, reflecting lower volatility as compared to the benchmark index. The outstanding market capitalisation was around £4.73 billion.

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