To all: below are the statements made by DLJ this
week re: NABI:
NABI had a very positive analyst meeting last
Friday. The company expects 30% growth in its high
margin ammunotherapy product sales. Product
development programs are moving ahead full speed.
The company expects to file for FDA approval on
HBIG-IM this spring. StaphVAX will move into Phase
3 clinical trials this year, and two more new
products will enter human trials this year. What
is most interesting is that for the first time NABI
showcased its cutting edge new technology platform
in designing anti-viral small molecule drugs. This
should put to rest the criticism that NABI's
technology platform is less advanced than other
leading biotechnology companies. We expect many
new products to emerge from NABI's technology base
in coming years. We think it is time to re-focus
on this unusually undervalued biotechnology
company. NABI is currently trading only at 20
times and 13 times of out 1996 and 1997 EPS
estimates, respectively. Considering the company
has a growth rate of 35% such a multiple is
drastically understating the value in this
well-rounded fast growing company. Based on
current year earnings, matching up with the growth
rate, at 35 times EPS estimate of .50, the stock
should be at $18. Even at 30 times current
earnings, the stock should be at $15. Looking
forward 12 months, the company should be able to
earn .79 in 1998. At 20 times 1998 earnings, the
stocks should be at $16, while if we give a
multiple of 30, the stock could be at 24.
Therefore, even if one put aside the excitement of
new product developments, based on near term
earnings alone, NABI is a value stock. We strongly
reiterate Recommended List Buy rating on NABI. |
