Rare Disease Gem II
Alexion Pharmaceuticals, Inc. (Alexion) Alexion Pharmaceuticals, Inc. (Alexion) is a biopharmaceutical company. Its marketed product Soliris (eculizumab) is the first and only therapeutic approved for patients with two ultra-rare and severe disorders resulting from chronic uncontrolled activation of the complement component of the immune system: paroxysmal nocturnal hemoglobinuria (PNH), an ultra-rare and life-threatening blood disorder, and atypical hemolytic uremic syndrome (aHUS), an ultra-rare and life-threatening genetic disease.
[PostStockWidget stock_valuation="" pricetype="live" manual_date="Dec. 21, 2012, 2:04pm GMT" symbolcodes="'ALXN'" symbolprices="175" div_align="right"]
We like Alexion because it is one of the few companies where earnings estimates have risen in the last six months. We also like the cash position of $1.9 billion and their strong track record.
Note that in October 2014, we exited Alexion at $189.90 with a 20% profit after only 6 weeks. The company pays no dividend; therefore we suggest a half position.
Purple Chips 12 -18 month target: $210.00
LOW VALUATION IN ALEXION PHARMA AT $175.10 (ALXN-US, $175.60) HALF POSITION
PURPLE CHIPS TARGET: $210.00 POSITION SIZE: HALF (2.5%) P/E: 36.7X DIV: NIL MKT CAP: $35B Cash: $1.9B RETURN ON CAPITAL: 35.4% EARNINGS YIELD: 2.6% 5 YR EPS Growth rate*:35.4% P/E/G Ratio: 0.79X Current EPS: $5.21 2016 EST.: $7.34 2017 EST.: $8.91
*Blended growth rate= 2/3 historical (5yrs), 1/3 forward.
