Halister News

(Bloomberg) -- Roche reported 2016 core EPS diluted CHF14.53, est. CHF14.73.

• Sees 2017 sales growth low-to-mid single digit at constant FX
• Core EPS targeted to grow in line with sales at constant FX
• Roche sees slower profit growth on cost of drug transition
• Shares up 1.8, most since December
• Volume 43% of 3-month daily avg

ODDO (Buy, PT CHF295)

• Few surprises, outlook seems cautious in terms of bottom line
• Management is taking a cautious stance pending Aphinity trial results, representing an opportunity of CHF4b
• Disposal of diabetes diagnostics division could bring in CHF5b (2.5x sales) and would be welcomed by market

CREDIT SUISSE (Outperform, PT CHF275)

• Lack of margin expansion highlights need to invest in Ocrevus, Tecentriq launches and profit deleverage as biosimilars impact the key Rituxan and Herceptin franchises
• Positive Aphinity outcome is key to offsetting this trend
• Unclear what Roche assumes in guidance on Aphinity

BERENBERG (Buy, PT CHF280)

• Guidance probably assumes that Aphinity fails as Roche said it allowed for “Aphinity outcomes,” explaining gap vs consensus
• Aphinity could be some impact on Perjeta sales in neo- adjuvant setting

CITI (Buy, PT CHF320)

• Immuno-oncology potential continues to be underappreciated
• Expect Roche to show an overall survival benefit in combination with Abraxane in NSCLC (lung cancer) in 2H
  • Opportunity may have increased following BMY’s recent commentary

BERNSTEIN (Outperform)

• Aphinity should work, but market doesn’t want binary event risk
• Roche L/T biosimilar concerns remain inescapable, but sees “distinct possibility it will continue to deliver the pipeline goods”