UPDATE: Goldman Sachs Raises PT on Mylan on Increased Confidence in Key Revenue/Earnings Drivers

In a report published Thursday, Goldman Sachs analyst Jami Rubin reiterated a Buy rating on Mylan (NASDAQ: MYL), and raised the price target from $40.00 to $46.00.

In the report, Goldman Sachs noted, “We raise our estimates on increased confidence in key revenue and earnings drivers. Our new forecast for 2018 EPS of $4.50 (~$5.50 pro forma for Agila) is still shy of MYL's 5-year CAGR revenue guidance of 13% and EPS of 16%, which implies 2018 revenue of $13 bn and EPS of at least $6.00, but is above consensus. Key changes to our model: (1) raising our probability for generic Copaxone and Advair/Seretide; (2) capital allocation with $200 mn in buybacks per year (we see upside to $500 mn/year); (3) tax rate of ~22% by 2018 per management guidance; and (4) probability of EpiPen generic competition. Generic Advair/Seretide could add over $2 to EPS on an unadjusted basis. We also outline a bull scenario (see inside), which implies potential EPS of $7-8 by 2018 (still doesn't include biosimilars or the branded Combo agent).”

Mylan closed on Wednesday at $38.05.