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Canonsburg, Pennsylvania-based Viatris Inc. (VTRS) is a global pharmaceutical and healthcare corporation. With a market cap of $13.6 billion, Viatris operates through Developed Markets, Greater China, JANZ (Japan, Australia, and New Zealand), and Emerging Markets segments.
Companies worth $10 billion or more are generally described as "large-cap stocks," Viatris fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the specialty & generic drug manufacturing industry. It offers prescription brand drugs, generic drugs, complex generic drugs, biosimilars, and active pharmaceutical ingredients (APIs).
Viatris touched its 52-week high of $13.62 on Feb. 23 and is now trading 16.4% below that peak. VTRS gained 11% over the past three months, outpacing the Dow Jones Industrials Average’s ($DOWI) 7.5% gains during the same time frame.
However, over the longer term, Viatris has underperformed DOWI. VTRS gained 15.3% over the past 52 weeks and 5.2% in 2024, lagging behind DOWI’s 22.1% gains over the past year and 11.6% returns on a YTD basis.
To confirm the recent bullish trend, VTRS has been trading above its 50-day and 200-day moving averages since mid-July, with some fluctuations.
Shares of Viatris surged 6.5% after the release of its Q2 earnings on Aug. 8. Despite a 3.2% year-over-year decline in net sales to $3.8 billion, attributed to the divestiture of its over-the-counter business, the company’s divestiture-adjusted net sales grew by approximately 2%. Additionally, adjusted EBITDA, also adjusted for the divestiture, increased by around 2% to $1.2 billion. The company’s adjusted EPS of $0.69 exceeded consensus estimates by 1.5%.
Viatris marks this divestiture as an inflection point for it to move towards accelerated growth and shareholder return. However, despite the initial uptick in share price, VTRS stock dipped 2.6% in the subsequent trading session and remained in red territory for the subsequent three trading sessions.
Viatris’s competitor, Sanofi (SNY), gained 4.4% over the past 52 weeks, lagging behind VTRS’ double-digit returns over the same time frame. However, in 2024, SNY is up 15.9%, outperforming VTRS on a YTD basis.
Among the six analysts covering the VTRS stock, the consensus rating is a “Hold.” The mean price target of $13.20 suggests a potential upside of 15.9% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
