CIMA, important Dow Jones excerpts
"Our belief is that it's an over-reaction," said Neal Zung of Fahnestock & Co. "People are reacting to a one-quarter shortfall, and the long-term prospects have not changed," he said, terming those prospects "excellent."
Zung predicted that once a current inventory problem is worked off, the company will "return to accelerated revenue and earnings growth."
David Steinberg, who follows the company for Deutsche Banc Alex. Brown, concurred. He said Cima's "fundamental story doesn't appear to have changed all that much."
Accordingly, he reiterated a buy rating on the stock Friday, as well as a $60 target price on the stock, although Steinberg lowered current-quarter estimates.
The analyst, who like others tracks weekly prescription levels for the major drugs incorporating Cima's taste-masking technology, wrote that "we still think forward growth in the range of 35%-40% is very achievable and potentially beatable."
Last week all three of Cima's biggest products hit new prescription highs in levels or market share, Deutsche Banc Alex. Brown analyst Steinberg said.
Those products are Zomig-ZMT, made by AstraZeneca PLC (AZN); Organon's Remeron SolTab and Schwarz Pharma's NuLev. Besides making pills taste better, Cima sells fast-dissolving technology to drugmakers.
"There's no reason to think that trajectory won't continue," Steinberg said. "The fundamental thesis appears to be intact." |
