NEW YORK (TheStreet) -- Shares of AstraZeneca Plc (AZN - Get Report) are up 1.59% to $79.11 in pre-market trade as it has been reported that Pfizer (PFE - Get Report) is planning to sweeten its bid for its U.K. rival for a second time, sources told Bloomberg.
Pfizer and its advisers are said to be crafting a new offer that would increase the value modestly above the current nearly $84 level while bumping the cash portion. Pfizer will probably wait until after U.K. government hearings to raise its bid, Bloomberg reports.
Pfizer is putting together a sweetened offer before it considers whether to make a hostile takeover attempt by bringing its proposal directly to AstraZeneca's shareholders, sources added.
TheStreet Ratings team rates ASTRAZENECA PLC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ASTRAZENECA PLC (AZN) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to its closing price of one year ago, AZN's share price has jumped by 52.39%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.2%. Since the same quarter one year prior, revenues slightly dropped by 2.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Despite currently having a low debt-to-equity ratio of 0.45, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.05 is sturdy.
- ASTRAZENECA PLC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, ASTRAZENECA PLC reported lower earnings of $2.04 versus $4.94 in the prior year. This year, the market expects an improvement in earnings ($4.22 versus $2.04).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Pharmaceuticals industry. The net income has significantly decreased by 134.8% when compared to the same quarter one year ago, falling from $1,507.00 million to -$524.00 million.
- You can view the full analysis from the report here: AZN Ratings Report