NEW YORK (TheStreet) -- Shares of Sanofi (SNY) are up 1.24% to $53.99 after it was reported that the healthcare company is looking to sell a portfolio of older drugs that could be worth $7 billion to $8 billion, sources say, Reuters reports.
The company was said to have hired financial advisers Evercore Partners Inc. (EVR) to help it with a deal and has contacted potential buyers in the past few months, sources added.
The drugs for sale include treatments for high blood pressure and cardio-metabolic diseases.
TheStreet Ratings team rates SANOFI as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate SANOFI (SNY) a BUY. This is driven by a number of 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 revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in net income, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- SNY's revenue growth has slightly outpaced the industry average of 1.4%. Since the same quarter one year prior, revenues slightly increased by 0.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- SNY's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.23, which illustrates the ability to avoid short-term cash problems.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 130.2% when compared to the same quarter one year prior, rising from $660.15 million to $1,519.99 million.
- The gross profit margin for SANOFI is rather high; currently it is at 58.07%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 12.27% trails the industry average.
- SANOFI reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SANOFI reported lower earnings of $1.91 versus $2.44 in the prior year. This year, the market expects an improvement in earnings ($3.55 versus $1.91).
- You can view the full analysis from the report here: SNY Ratings Report