Impax Laboratories Receives a Sell from UBS

By Carrie Williams

UBS analyst Marc Goodman reiterated a Sell rating on Impax Laboratories (NASDAQ: IPXL) yesterday and set a price target of $12. The company’s shares opened today at $14.20, close to its 52-week low of $13.35.

Goodman observed:

“(1) At the mid-point, the difference between the lowered new and previous 2016 rev guidance is ~$72M, and mgt indicated that ~70% of this change was due to the deeper-than-expected rebates required to retain volumes for the products acquired from Teva. The rebates were concentrated to a handful of products (not all 15) including Pulmicort (Apotex entry) and propranolol. (2) Mgt now expects to launch up to 10 generic products (vs prior 12-14) this year because of delays at the FDA. (3) We are lowering our EPS for 2016 from $1.58 to $1.15 and for 2017 from $2.60 to $1.80.”

According to TipRanks.com, Goodman is a 2-star analyst with an average return of 0.0% and a 46.9% success rate. Goodman covers the Healthcare sector, focusing on stocks such as Sucampo Pharmaceuticals, Jazz Pharmaceuticals, and Horizon Pharma Inc.

Impax Laboratories has an analyst consensus of Hold.

Based on Impax Laboratories’ latest earnings report for the quarter ending September 30, the company posted quarterly revenue of $228 million and GAAP net loss of $179 million. In comparison, last year the company earned revenue of $221 million and had a net profit of $35.76 million.

Based on the recent corporate insider activity of 31 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of IPXL in relation to earlier this year. Most recently, in March 2016, Leslie Benet, a Director at IPXL bought 3,500 shares for a total of $22,925.

Impax Laboratories, Inc. operates as a technology based specialty pharmaceutical company, which engages in the development, manufacture and marketing of controlled-release and niche generics. It operates through the Impax Generics and Impax Specialty Pharma segments. The Impax Generics segment concentrates on the development manufacture, sale and distribution of generic products, which are the pharmaceutical and therapeutic equivalents of brand-name drug products and are usually marketed under their established nonproprietary drug names rather than by a brand name. The Impax Specialty Pharma segment engages in the development of proprietary brand pharmaceutical products. The company was founded on December 14, 1999 and is headquartered in Hayward, CA.