A quarter from Concordia Healthcare (TSX:CXR, Nasdaq: CXRX) that met expectations is getting the thumbs up from Cantor Fitzgerald Canada analyst Scott Curtis.
On November 12, Concordia Healthcare reported its third quarter, 2015 results. The company lost (U.S.) $4.39-million on revenue $94.9-million, a 161% topline bump over the same period last year.
“Our legacy business continues to perform strongly quarter over quarter,” said CEO Mark Thompson. “This is a testament to our business model as well as our commitment to delivering value to our shareholders. As we move into the next phase of Concordia’s evolution, we expect to demonstrate underlying organic growth of our business through continued promotion of our legacy portfolio, growth of our Photofrin business and successful product launches from our existing pipeline. The third quarter of 2015 has been one of the most significant and important periods in Concordia’s history,” “We completed the acquisition of AMCo, which has transformed Concordia into a global organization with more than 200 well-established legacy products sold in over 100 countries.
Curtis says Concordia is now trading below below its peer group on an EV/EBITDA basis and a steep discount on a P/E basis. The analyst summarized the quarter.
“This was another strong quarter for Concordia with full contribution from the Covis portfolio – revenue and Adj. EBITDA were in-line with our estimates,” said Curtis. “Revenue was $94.9M (CFCC: $93.7M; Cons: $94.4M) – represents 161% YoY and 22% QoQ growth. Adj. EBITDA came in at US$71.7M (CFCC: $68.6M; Cons: $69.3M) implying an Adj. EBITDA margin of 75.6%; Adj. EPS was $1.46 (CFCC: $1.31; Cons: $1.32). Covis contributed $52.9M of quarterly sales to the Legacy Pharmaceutical Division (55.7% of total revenue) and Donnatal delivered strong volume-driven growth. In addition, Concordia reiterated its 2016 preliminary guidance and affirmed that its immediate priority is de-leveraging its balance sheet.”
In a research update to clients today, Curtis maintained his “Buy” recommendation and one-year price target of (U.S.) $80.00 (C) $100.