Analyst Eric Coldwell of Robert W. Baird reiterated a Buy rating on Catalent (CTLT – Research Report), with a price target of $56.00.
Eric Coldwell has provided a Buy rating for Catalent’s stock due to a number of encouraging factors. The company’s position as a leading Contract Development and Manufacturing Organization (CDMO) for the biopharma industry is noteworthy. Specifically, Coldwell highlighted Catalent’s strong growth prospects in sterile fill-finish and cell & gene therapies (C>), particularly emphasizing their leadership in adeno-associated virus (AAV) capabilities. He also expects the company’s utilization rates to improve, and foresees a return to historical margin levels, a positive trend in free cash flow generation, and a target leverage ratio of 3.0x over time.
Moreover, despite there being no update on the fiscal year 2024 guidance, the outlook appears consistent with previous estimates, suggesting stability in the company’s financial expectations. Coldwell remains optimistic about Catalent’s recovery in the second half of the fiscal year, driven by internal efforts, a promising pipeline, and an anticipated improvement in the capital markets environment. Additionally, he notes the ongoing partnership with Sarepta Therapeutics on the manufacturing of ELEVIDYS, which remains solid contrary to some market speculation. Overall, Coldwell believes that the market has undervalued Catalent’s diverse growth drivers that should bolster its performance through FY24 and beyond.
According to TipRanks, Coldwell is a 4-star analyst with an average return of 4.3% and a 54.22% success rate. Coldwell covers the Healthcare sector, focusing on stocks such as Icon, Catalent, and Charles River Labs.
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Catalent (CTLT) Company Description:
Catalent, Inc. is a holding company, which engages in the provision of delivery technologies and development solutions for drugs, biologics, and consumer and animal health products. It operates through the following segments: Softgel Technologies; Biologics and Specialty Drug Delivery; Oral Drug Delivery; and Clinical Supply Services. The Softgel Technologies segment formulate, develop, and manufacture services for soft capsules. The Biologics and Specialty Drug Delivery segment develops and manufacture services for blow-fill-seal unit doses, prefilled syringes, vials, and cartridges; analytical development and testing services for large molecules; inhaled products for delivery via metered dose inhalers, dry powder inhalers, and intra-nasal sprays. The Oral Drug Delivery segment focuses in the formulation development and manufacturing technologies, and related solutions including: clinical development and commercial manufacturing of a range of oral dose forms, including proprietary fast-dissolve Zydis tablets and both conventional immediate and controlled release tablets, capsules, and sachet products. The Clinical Supply Services segment includes packaging, labeling, storage, distribution, and inventory management for drugs and biologics in clinical trials. The company was founded in April 2007 and is headquartered in Somerset, NJ.
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