Actionable news
All posts from Actionable news
Actionable news in PRGO: PERRIGO COMPANY PLC,

B. Riley Cuts Perrigo's Price Target From $146 To $113 On Papa's Exit, FY16 Guidance

Invest with Confidence. Are you a financial professional? Stay on top of your portfolio with Benzinga Pro's real-time newsfeed and alerts and never miss a headline again.
Don't miss the chance to try it FREE today.

Linda Bolton Weiser of B. Riley maintains a Neutral rating on Perrigo Company plc Ordinary Shares PRGO 17.96%, but slashed the stock's price target to $113 per share from a previous $146 price target.

The analyst's revised price target was attributed to Perrigo's "disappointing" announcement of its preliminary first-quarter results and a lack of revised sales guidance for the full fiscal year. As such, Bolton Weiser lowered the company's organic top-line growth expectation from 7 percent to 3 percent.

Bolton Weiser added that Perrigo's lower earnings outlook will result in a "slower pace" of deleveraging. In return, this could "dampen" the company's M&A activity in the near to medium term.

Bolton Weiser also suggested that the company's lower earnings outlook will result in a reduction to its debt repayment profile. The analyst now expects the company to repay $600 million in debt in 2016 from a prior estimate of $1.1 billion and $1.0 billion in 2017, marking a reduction from prior expectations of $1.3 billion.

"While it's possible PRGO could again become a take-over target, by Mylan (MYL; N/R) or another healthcare company that already has a low tax rate, we are maintaining our Neutral rating until we see improvement in PRGO's underlying fundamentals," the analyst wrote.

Shares of Perrigo lost more than 15 percent on Monday and hit a new 52-week low of $101.85.

Apr 2016Wells FargoDowngradesOutperformMarket Perform
Apr 2016BTIG ResearchDowngradesBuyNeutral
Apr 2016Stifel NicolausDowngradesBuyHold

© 2016 Benzinga does not provide investment advice. All rights reserved.