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Why Has AstraZeneca’s Stock Price Increased in 2018?

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Stock performance

On November 19, AstraZeneca’s (AZN) stock price closed at $40.80, which represents ~5% growth from its closing price of $38.78 on October 31. AstraZeneca’s stock price grew from $34.70 when the market closed on December 29, 2017, to $40.80 on November 19, which reflects ~18% year-to-date growth.

AstraZeneca’s stock price closed at $40.80 on November 19, which represents ~28% growth from its 52-week low of $31.99 on December 6, 2017. Notably, AstraZeneca hit its 52-week high of $41.78 on November 13.

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Financials in a nutshell

AstraZeneca’s net revenues during the first nine months of 2018 were $15.7 billion, which reflected a decline of ~6% YoY (year-over-year). Analysts expect AstraZeneca’s net revenues in 2018 to be ~$22.1 billion, which represents a decline of ~1.47% YoY.

AstraZeneca’s peers in the biopharmaceuticals market, AbbVie (ABBV), Celgene (CELG), and Bausch Health (BHC) generated revenues of $8.2 billion, $3.9 billion, and $2.1 billion, respectively, in the third quarter, which reflects ~17.7% and ~18.41% YoY growth and an ~3.74% YoY decline.

AstraZeneca’s gross margin and gross profit during the first nine months of 2018 were 78.4% and $12.4 billion, respectively—compared to 80.3% and $13.6 billion during the same period in 2017.

AstraZeneca’s net EPS during the first nine months of 2018 was $0.88—compared to $1.34 during the same period in 2017.

Growth driver

AstraZeneca’s Oncology segment mainly boosted the company’s revenue growth. The Oncology segment generated revenues of $4.3 billion during the first nine months of 2018, which reflects ~47% YoY growth. In the Oncology segment, Tagrisso, Lynparza, Iressa, and Imfinzi pushed the revenue growth during the first nine months. Tagrisso and Iressa’s net revenues during the first nine months of 2018 were $1.3 billion and $406.0 million, respectively, which reflects ~94% and ~2% YoY growth.

Lynparza, Imfinzi, and Calquence reported revenues of $438.0 million, $371.0 million, and $38.0 million, respectively.

Analysts’ recommendations

Among the six analysts tracking AstraZeneca in November, four recommended a “strong buy,” one recommended a “buy,” and one recommended a “hold.”

On November 20, AstraZeneca had a consensus 12-month target price of $42.26, which represents an ~3.58% return on investment over the next 12 months.

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