AstraZeneca PLC (LSE:AZN) offers sector-leading diversified growth at a reasonable price, according to Morgan Stanley (NYSE:MS).
The investment bank resumed coverage with an ‘overweight’ recommendation and a 9,800p target price, adding that risks are “skewed to the upside given growth and significant pipeline & product optionality”.
READ: AstraZeneca receives EU approval for chronic kidney disease drug
The FTSE 100 pharma giant has been receiving a flurry of approvals for its drug candidates, including Forxiga for chronic kidney disease in the EU on Monday, Saphnelo for lupus in the US last week and Imfinzi for lung cancer in China earlier in July.
On Monday it also announced that Enhertu showed a better outcome compared to the standard of care, trastuzumab emtansine (T-DM1), in a trial on breast cancer patients.
It was an interim reading so more details will be published soon, but analysts at UBS said that the progression-free survival benefit is expected to look good.
The bank noted that tolerability will be key moving forward, as so far Enhertu's Achilles heel has been interstitial lung disease.
“How this will pan out will depend on clinical data but at the moment our and consensus Enherru assumptions (collaboration revenues circa US$1bn) do not make aggressive assumptions leaving nice upside optionality,” analysts said.
Enhertu is being developed with Daiichi Sankyo.
Shares in AstraZeneca were flat at 8,171p on Monday at noon.