WST inventory lower to Impartial at BofA citing near-term headwinds after Q3 replace (NYSE:WST)

Financial institution of America downgraded West Pharmaceutical Providers (NYSE:WST) to Impartial from Purchase on Friday, citing supply-side headwinds and strain on COVID-19-related gross sales after the life sciences firm reported its Q3 2022 outcomes.

West Pharma (WST) fell greater than 13% on Thursday after the corporate’s quarterly outcomes fell in need of Avenue forecasts, and its up to date outlook stood beneath the consensus.

BofA analysts led by Derik de Bruin favor West Pharma’s (WST) aggressive optimistic and suppose its long-term market fundamentals are enticing.

Nevertheless, the workforce argues that WST’s supply-side points, which began in late Q3 as a result of capability constraints and surprising complexity in useful resource allocation to non-COVID-related merchandise, would final till at the least early 2023, when further capability is predicted.

The analysts additionally level to the corporate’s determination to extend the projection for FY23 COVID-related gross sales decline.

Regardless of a possible enchancment in provide aspect points over 2023, “the converging headwinds make it troublesome to see how WST can keep away from a cloth margin and EPS contraction within the coming yr,” the analysts wrote, slashing the worth goal within the inventory to $250, from $385 per share.

Wall Avenue has remained bullish on West Pharma (WST) inventory, with a median ranking of Purchase from analysts. Nevertheless, Searching for Alpha Creator scores and Searching for Alpha’s quant system, which persistently beats the market, rated WST as a Maintain.