The market appears to like the fact that Pfizer (PFE) won’t be able to buy AstraZeneca (AZN) at what could be an elevated price. AstraZeneca, not so much.
Reuters Shares of AstraZeneca have dropped 11% to $71.19 at 2:28 p.m. today, while Pfizer has risen 1.1% to $29.43. Citigroup’s Andrew Baum and team say the selloff in AstraZeneca has created a buying opportunity:
Our in-depth November 2013 report laid out what we saw as the extreme undervaluation of AstraZeneca’s early/mid-stage oncology pipeline, >26% upside to consensus EPS post-2017 and the greatest valuation delta (>45% at that time) to our £49/share NPV estimate compared with its global peers. We updated our analysis…shortly ahead of PFE's announced AZN bid. Following the -13% sell-off after today's rejection by the AZN board of PFE's £55/share offer, we add Buy-rated AstraZeneca to the Citi Focus List Europe based on our extensive previous analysis of its fundamental value drivers.
In this weekend’s Barron’s, Andrew Bary said Pfizer should walk away from AstraZeneca. Same difference.
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