Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Vivo Participacoes (NYSE: VIV), America Movil (NYSE: AMX), TIM Participacoes (NYSE: TSU), Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) and Eli Lilly (NYSE: LLY).
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Here are highlights from Monday’s Analyst Blog:
Brazil's Market Overreacts on Vivo
We do believe the market overreacted on Vivo Participacoes (NYSE: VIV) last Friday. On Friday it was announced that the Brazilian wireless market added 415.9 thousand new customers during the month of February 2009. The number was considered negative by the market -- in February 2008, net additions were 1.27 million.
Additionally Claro, controlled by America Movil (NYSE: AMX) and TIM Participacoes (NYSE: TSU) slightly increased their market shares, while Vivo's market share was reduced from 30% in the end of 2008 to 29.80% in February 2009.
Vivo's ADRs were down more than 10%. VIV has been recovering fast in the last 3 months, thus it seems that the news was a great excuse for a profit-taking move.
Amylin Looks Range-Bound
We have been cautious on Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) since the beginning of 2008, and we are still unconvinced that LAR will be approved on its first cycle FDA review. However, with the shares trading at multi-year lows, and the stock down 70% over the past year, the worst may be over for Amylin. Eli Lilly’s (NYSE: LLY) obvious commitment to Byetta and LAR will probably put a floor under further price declines.
News that Amylin will move forward with the LAR filing in mid-2009 is a positive, but we are still unconvinced the drug will be approved on first cycle review. In the meantime, an FDA decision on Byetta as a monotherapy could provide a boost to the shares in the near-term. Looking forward, we are optimistic on the mid-stage obesity pipeline. We see $14 as fair value.
Amylin currently trades at 10x our 2013 EPS estimate of $1.06. The 2013 multiple is a slight premium to the large-cap pharma / biotechnology peer-group average of 8x 2013 EPS. The peer-group consists of several large-cap bellwethers, including Lilly (7x), Merck (7x), Genentech (13x), Amgen (6x), Biogen Idec (10x), Gilead (10x), Celgene (12x) and Genzyme (9x). We feel the current valuation is reasonable.
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