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Stifel raises Virbac share price target citing strong Q1 and Sasaeah acquisition impact

EditorEmilio Ghigini
Published 04/17/2024, 09:33 AM

On Wednesday, Stifel adjusted its financial outlook for Virbac SA (VIRP:FP) (OTC: VRBCF), a veterinary pharmaceutical company, by increasing the share price target to €369.00 from the previous €349.00.

Despite the price target change, the firm maintained its Hold rating. This revision follows Virbac's announcement of a robust first quarter, with like-for-like sales growing by 9.7%, significantly propelled by a 16.2% increase in the companion animal segment.

The sales growth in the companion animal division was attributed primarily to a roughly 6.4 percentage point surge from volume expansion, supplemented by a modest price effect. The latter was mainly due to a deceleration in inflation rates. Virbac has confirmed its financial guidance for the year 2024, staying on course with its previously stated expectations.

The revision to Stifel's assessment includes the recent acquisition of Sasaeah, a Japanese firm, which was completed earlier in the month. This new business venture is anticipated to contribute over four percentage points to Virbac's revenue growth in 2024.

The acquisition's impact, coupled with a stronger-than-expected top-line performance, has led Stifel to revise its forecasts upwards, with an increase in estimated earnings per share (EPS) by 11% and 18% for 2024 and 2025, respectively.

The updated price target of €369 reflects an increase of €20 from the former target, based on the positive first-quarter trading update and the expected revenue contributions from the Sasaeah acquisition. The new price target takes into consideration the upward revisions to both revenue and EPS forecasts for the coming years.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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