Zacks Investment Research Upgrades Mallinckrodt (NYSE:MNK) to Hold

Mallinckrodt (NYSE:MNK) was upgraded by Zacks Investment Research from a “strong sell” rating to a “hold” rating in a research note issued to investors on Tuesday, January 9th.

According to Zacks, “Mallinckrodt is selling its hemostasis products for Baxter. The company aims to focus better on its specialty pharmaceutical business after having sold its Nuclear Imaging business.Mallinckrodt is facing challenging conditions as lead drug Acthar sales declined on volume while weaknesses in the generics segment persist. Acthar declined as specialty drugs face payer environment and the decline is expected to continue in the fourth quarter as well. The company's generic segment continues to face weakness as various product categories are witnessing stiff competition, which is hurting both their volumes and prices. Shares of the company have underperformed the industry in the last six months. A U.S. District Court recently invalidated 11 patents covering its second-largest product Inomax.  As  a result, Mallinckrodt is looking to diversify its portfolio with the recently announced Sucampo acquisition and counter the decline in existing drugs.”

A number of other equities analysts have also issued reports on the company. Piper Jaffray Companies set a $67.00 price target on Mallinckrodt and gave the company a “buy” rating in a research note on Saturday, October 21st. Goldman Sachs Group started coverage on Mallinckrodt in a research note on Thursday, September 28th. They set a “buy” rating and a $55.00 price target for the company. Stifel Nicolaus reaffirmed a “buy” rating on shares of Mallinckrodt in a research note on Friday, October 6th. Wells Fargo & Co lowered Mallinckrodt from an “outperform” rating to a “market perform” rating in a research note on Wednesday, November 8th. Finally, UBS Group set a $70.00 price target on Mallinckrodt and gave the company a “buy” rating in a research note on Friday, October 6th. Two equities research analysts have rated the stock with a sell rating, thirteen have issued a hold rating and seven have issued a buy rating to the stock. The company presently has an average rating of “Hold” and an average target price of $43.25.

Shares of Mallinckrodt (NYSE MNK) opened at $18.06 on Tuesday. Mallinckrodt has a 1 year low of $17.46 and a 1 year high of $55.32. The company has a debt-to-equity ratio of 1.08, a current ratio of 1.38 and a quick ratio of 1.05. The company has a market capitalization of $1,740.00, a P/E ratio of -903.00, a P/E/G ratio of 0.38 and a beta of 1.30.

Mallinckrodt (NYSE:MNK) last posted its earnings results on Tuesday, November 7th. The company reported $1.97 EPS for the quarter, beating the consensus estimate of $1.80 by $0.17. Mallinckrodt had a return on equity of 14.79% and a net margin of 11.43%. The firm had revenue of $793.90 million for the quarter, compared to analysts’ expectations of $808.93 million. During the same period last year, the firm earned $2.04 EPS. The firm’s revenue was down 10.5% compared to the same quarter last year. equities analysts anticipate that Mallinckrodt will post 7.2 earnings per share for the current year.

In related news, VP Steven J. Romano bought 2,000 shares of the business’s stock in a transaction on Monday, November 13th. The shares were bought at an average cost of $21.96 per share, for a total transaction of $43,920.00. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director David R. Carlucci bought 10,000 shares of the business’s stock in a transaction on Thursday, November 9th. The shares were bought at an average price of $21.83 per share, for a total transaction of $218,300.00. Following the completion of the acquisition, the director now owns 26,020 shares of the company’s stock, valued at $568,016.60. The disclosure for this purchase can be found here. Over the last quarter, insiders have purchased 30,460 shares of company stock valued at $659,486. 0.53% of the stock is owned by corporate insiders.

A number of hedge funds and other institutional investors have recently bought and sold shares of the business. Sterling Capital Management LLC bought a new position in shares of Mallinckrodt in the second quarter worth about $204,000. Shelton Capital Management bought a new position in shares of Mallinckrodt in the third quarter worth about $205,000. State of Alaska Department of Revenue bought a new position in shares of Mallinckrodt in the fourth quarter worth about $129,000. Cubist Systematic Strategies LLC increased its stake in shares of Mallinckrodt by 748.1% in the third quarter. Cubist Systematic Strategies LLC now owns 7,989 shares of the company’s stock worth $299,000 after purchasing an additional 7,047 shares during the period. Finally, Pinnacle Associates Ltd. increased its stake in shares of Mallinckrodt by 69.8% in the third quarter. Pinnacle Associates Ltd. now owns 8,025 shares of the company’s stock worth $300,000 after purchasing an additional 3,300 shares during the period. Institutional investors own 97.38% of the company’s stock.

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About Mallinckrodt

Mallinckrodt public limited company develops, manufactures, markets and distributes branded and generic specialty pharmaceutical products and therapies. The Company focuses on various therapeutic areas, such as autoimmune and rare disease specialty areas, including neurology, rheumatology, nephrology, ophthalmology and pulmonology; immunotherapy and neonatal critical care respiratory therapies; analgesics and hemostasis products, and central nervous system drugs.

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