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Viatris (VTRS) Declines on Lackluster Outlook, Announces Dividend
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Shares of Viatris Inc. (VTRS - Free Report) were down 14.9% after it issued a lackluster outlook for 2021.
We remind investors that Viatris was formed in November 2020 through the combination of Mylan and Pfizer's (PFE - Free Report) Upjohn business.
The company expects revenues of $17.2-$17.8 billion in 2021. Management stated that 2021 will be a tough year in terms of revenues, adjusted EBITDA and free cash flow, particularly due to a delay in the closing of the merger of Mylan and Pfizer's Upjohn business.
In December 2020, Viatris announced that it expects to optimize its commercial capabilities and close, downsize or divest up to 15 manufacturing facilities globally that it believes are no longer viable either due to surplus capacity, challenging market dynamics or a shift in its portfolio toward more complex products. Consequently, 20% of its global workforce of approximately 45,000 is likely to be affected upon the completion of the restructuring initiative.
The initiative was intended to reduce the company's cost base by at least $1 billion by the end of 2024. Viatris now stated that these cost synergies will be achieved in three years.
The company also announced that it will pay an annualized dividend of approximately $540 million, or $0.44 per share. However, due to the timing of the initiation of the dividend, it expects to make three payments in 2021 totaling approximately $400 million. Viatris expects the first quarterly dividend of $0.11 per share to be declared in May 2021 and distributed in June 2021, subject to the board's first-quarter 2021 review.
It also expects to repay approximately $6.5 billion in debt by the end of 2023.
Shares of Viatris have declined 17.3% in the year so far against the industry’s growth of 8.4%.
A slowdown in the generics business has forced Mylan to look for strategic options. The combined entity will focus more on emerging markets to counter the slowdown in developed markets.
Repligen’s earnings per share estimates have moved up from $1.63 to $1.66 for 2021 in the past 90 days.
Dynavax loss per share estimates have narrowed to 17 cents from 45 cents in the past 30 days.
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Viatris (VTRS) Declines on Lackluster Outlook, Announces Dividend
Shares of Viatris Inc. (VTRS - Free Report) were down 14.9% after it issued a lackluster outlook for 2021.
We remind investors that Viatris was formed in November 2020 through the combination of Mylan and Pfizer's (PFE - Free Report) Upjohn business.
The company expects revenues of $17.2-$17.8 billion in 2021. Management stated that 2021 will be a tough year in terms of revenues, adjusted EBITDA and free cash flow, particularly due to a delay in the closing of the merger of Mylan and Pfizer's Upjohn business.
In December 2020, Viatris announced that it expects to optimize its commercial capabilities and close, downsize or divest up to 15 manufacturing facilities globally that it believes are no longer viable either due to surplus capacity, challenging market dynamics or a shift in its portfolio toward more complex products. Consequently, 20% of its global workforce of approximately 45,000 is likely to be affected upon the completion of the restructuring initiative.
The initiative was intended to reduce the company's cost base by at least $1 billion by the end of 2024. Viatris now stated that these cost synergies will be achieved in three years.
The company also announced that it will pay an annualized dividend of approximately $540 million, or $0.44 per share. However, due to the timing of the initiation of the dividend, it expects to make three payments in 2021 totaling approximately $400 million. Viatris expects the first quarterly dividend of $0.11 per share to be declared in May 2021 and distributed in June 2021, subject to the board's first-quarter 2021 review.
It also expects to repay approximately $6.5 billion in debt by the end of 2023.
Shares of Viatris have declined 17.3% in the year so far against the industry’s growth of 8.4%.
A slowdown in the generics business has forced Mylan to look for strategic options. The combined entity will focus more on emerging markets to counter the slowdown in developed markets.
Zacks Rank & Stocks to Consider
Viatris currently carries a Zacks Rank #4 (Sell).
A couple of better-ranked stocks in the healthcare space are Repligen (RGEN - Free Report) and Dynavax Technologies Corporation (DVAX - Free Report) , both carrying a Zacks Rank #2 (Buy), presently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Repligen’s earnings per share estimates have moved up from $1.63 to $1.66 for 2021 in the past 90 days.
Dynavax loss per share estimates have narrowed to 17 cents from 45 cents in the past 30 days.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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