RBC Capital Markets nudges down Alliance Pharma price target

RBC Capital Markets nudged its price target on Alliance Pharma down to 60p from 65p on Wednesday as it said it was rebasing its forecasts as trading normalises.

Alliance Pharma
31 January 2024 10:42:31

Source: Sharecast

The bank, which rates Alliance at ‘outperform’, said it applies 11x price-to-earnings and 6x EV/EBITDA multiples, representing the bottom of the 2025E ranges of global consumer health and UK smid healthcare peers, to its 2026 earnings forecast.

This implies a 12% cost of equity in its discounted cash flow calculation.

RBC cut its 2024 pre-tax profit estimate by around 20%, mostly based on higher operating investments, although it has trimmed revenue forecasts on the basis of the 'above market' guidance provided by the company.

The bank said many of the issues faced by Alliance Pharma in the last 18 months are behind it, and the company now aims to increase marketing investment in its key brands.

"Once the CMA appeal overhang is resolved (we assume imminently), the shares can start better reflecting fundamentals of a growth Consumer Health business, and we see 50% upside to the stock in the first leg of its recovery," it said.

Transferring your account

Transfer your existing ISAs and Share Dealing Accounts and you could save money. In order to transfer, log in to your existing account and complete the online application form. We’ll do the rest for you. It’s free to transfer (we will not charge you). Please check your current provider to see if they have any charges for transferring.

Transfer to us

N/A

Isin: N/A

Exchange: N/A

Sell:

N/A

Buy:

N/A

Change:

Date:

Prices delayed by at least 15 minutes

Compare our accounts

If you're looking to grow your money over the longer term (5+ years), we have a range of investment choices to help.

View our accounts

Bank of Scotland is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.

Important legal information

Bank of Scotland Share Dealing Service is operated by Halifax Share Dealing Limited. Halifax Share Dealing Limited. Registered in England and Wales No. 3195646. Registered Office: Trinity Road, Halifax, West Yorkshire HX1 2RG. Authorised and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN under number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.

The information contained within this website is provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd unless otherwise stated. The information is not intended to be advice or a recommendation to buy, sell or hold any of the shares, companies or investment vehicles mentioned, nor is it information meant to be a research recommendation. This is a solution powered by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd incorporating their prices, data news, charts, fundamentals and investor tools on this site. Terms and conditions apply. Prices and trades are provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd and are delayed by at least 15 minutes.

Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.