Trading Idea Update – Mayne Pharma – In the Money!
MYX up 44% at $2.06 at the open of trading today
On the 31st of May 2016, we sent out a recommendation to diversify your portfolio with an emerging high growth prospect pharmaceutical company – Mayne Pharma Ltd (MYX). Back on 31 May, the stock was trading below $1.60 – in this morning’s trade, the stock hit a high of $2.06
MYX has been in the news this week as they have announced an acquisition of US generic product portfolio from TEVA and ALLERGEN worth $652m. The market has had a very positive response to this news and the stock has traded above $2.00 today.
Through this acquisition MYX will increase their portfolio of generic drugs by 37 FDA approved and 5 pending products (details of specifics pending).
- This puts Mayne’s US generic drug division into the top 25 retail pharmaceutical companies and into the top 2 companies that produce generic oral contraceptives in the US.
- The ‘transformational acquisition’ for the Aussie drug manufacturer is expected to see earnings per share rise 31% in fiscal 2017 and 35% in fiscal 2018.
We see support for earnings per share (EPS) growth and long-term market share growth being supported from this acquisition.
After the announcement on Tuesday we see Mayne Pharma as a long-term buy at these levels and a great medium-term trade if the price pulls back towards the $1.75 level
MYX are currently trading at $1.90
Below is a chart showing Mayne’s trading over the past month.
