StephN
07-21-2008, 05:20 AM
Thought this interesting from today's internet news. Our little old Herceptin maker has really hit the big time with success of its drugs! Notice that the article says that Avastin is now their #1 drug.
A buyout of Genentech likely, but offer too low
Posted Jul 21st 2008 3:54AM by Douglas McIntyre (http://www.bloggingstocks.com/bloggers/douglas-mcintyre)
Filed under: Earnings reports (http://www.bloggingstocks.com/category/earnings-reports/), Deals (http://www.bloggingstocks.com/category/deals/), Genentech Inc (DNA) (http://www.bloggingstocks.com/category/dna/)
Roche, the Swiss drug maker, has offered to buy the 45% of biotech giant Genentech (http://finance.aol.com/quotes/genentech-inc/dna/nys) (NYSE: DNA (http://finance.aol.com/quotes/genentech-inc/dna/nys)) that it does not already own. The offer totals $43.7 billion in cash. According to (http://www.reuters.com/article/ousiv/idUSL2136372020080721) Reuters, Roche "would offer $89 per share to buy up the remaining stake, a 9 percent premium to the biotech company's closing share price on Friday."
The transaction would probably be a poor deal for Genentech holders and the board of the company should reject it and push for a higher price. When reporting quarterly earnings recently, the company raised its outlook to a range of $3.40 to $3.50 per share, from $3.35 to $3.40. Several brokerages made positive comments about Genentech and Citigroup began coverage of the stock as a "buy" with a $91 price target.
Although Genentech's shares are trading at a 52-week high at nearly $82, the firm is just recovering from rough earnings in last 2007. Early last year, before the rocky patch, the stock traded just below $90. The Genentech's No.1 drug, cancer treatment Avastin, is expected to do extremely well over the next several years.
The Roche offer does not take into account the fact that Wall St. expects Genentech to be a powerful growth company during the rest of the decade making the stock worth well over $90.
Douglas A. McIntyre is an editor at 247wallst.com.
A buyout of Genentech likely, but offer too low
Posted Jul 21st 2008 3:54AM by Douglas McIntyre (http://www.bloggingstocks.com/bloggers/douglas-mcintyre)
Filed under: Earnings reports (http://www.bloggingstocks.com/category/earnings-reports/), Deals (http://www.bloggingstocks.com/category/deals/), Genentech Inc (DNA) (http://www.bloggingstocks.com/category/dna/)
Roche, the Swiss drug maker, has offered to buy the 45% of biotech giant Genentech (http://finance.aol.com/quotes/genentech-inc/dna/nys) (NYSE: DNA (http://finance.aol.com/quotes/genentech-inc/dna/nys)) that it does not already own. The offer totals $43.7 billion in cash. According to (http://www.reuters.com/article/ousiv/idUSL2136372020080721) Reuters, Roche "would offer $89 per share to buy up the remaining stake, a 9 percent premium to the biotech company's closing share price on Friday."
The transaction would probably be a poor deal for Genentech holders and the board of the company should reject it and push for a higher price. When reporting quarterly earnings recently, the company raised its outlook to a range of $3.40 to $3.50 per share, from $3.35 to $3.40. Several brokerages made positive comments about Genentech and Citigroup began coverage of the stock as a "buy" with a $91 price target.
Although Genentech's shares are trading at a 52-week high at nearly $82, the firm is just recovering from rough earnings in last 2007. Early last year, before the rocky patch, the stock traded just below $90. The Genentech's No.1 drug, cancer treatment Avastin, is expected to do extremely well over the next several years.
The Roche offer does not take into account the fact that Wall St. expects Genentech to be a powerful growth company during the rest of the decade making the stock worth well over $90.
Douglas A. McIntyre is an editor at 247wallst.com.