Valeant Pharma (VRX) 1Q16 Was A Clean-Up Quarter - Guggenheim

Guggenheim analyst, Louise Chen, defended Valeant Pharmaceuticals (NYSE: VRX) as she continues to believe that VRX's long-term growth prospects are underappreciated. Upside to expectations could come from: 1) divestment of non-core products to pay down debt; 2) meeting or beating quarterly earnings in '16; and, 3) approval and launch of new brand drugs (Vesneo, Brimonidine, brodalumab, Emerade and others).

The analyst also think VRX's '16 guidance is conservative, and does not include upside from cost cuts or a meaningful increase in ASPs for the dermatology business.

Potential Catalysts: 1) Launch progressions and sales recovery of Jublia, Ultra, Luzu, Retin-A Micro 0.08%, Onexton; 2) Launches of Vesneo, Brimonidine, brodalumab, EnVista Toric, Lotemax Gel Nex Gen, Ultra Plus Powers, BioTrue Toric, Arestin LCM, Emerade '16/'17; 3) Pipeline Advancements, '16+; 4) Divestiture of non-core assets, '16+; and, 5) Debt paydown.

The firm lowered estimate but maintained a Buy rating and $55 price target on VRX.

For an analyst ratings summary and ratings history on Valeant Pharmaceuticals click here. For more ratings news on Valeant Pharmaceuticals click here.

Shares of Valeant Pharmaceuticals closed at $24.64 yesterday.

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