On Thursday, Piper Sandler confirmed its Overweight rating and a $71.00 stock price target for Amphastar Pharmaceuticals (NASDAQ:AMPH), following the company's announcement of receiving FDA approval for its new generic inhalation product, AMP-008. The product, which is a generic version of Teva's ProAir HFA (albuterol sulfate inhalation aerosol), is set to be available in the third quarter of 2024.
Amphastar's newly approved AMP-008 joins a selection of complex generic products that are slated to drive the company's growth in the near future. The approval is not considered a transformative event for Amphastar, but it is expected to significantly contribute to the company's revenue. This is partly due to the limited competition in this market segment, which involves drug/device combinations in high-volume categories.
The market for albuterol HFA generics is substantial, with over 50 million prescriptions filled in 2023 according to data from IQVIA. The approval of AMP-008 positions Amphastar to capitalize on this demand, potentially leading to a stable increase in sales.
In addition to the expected revenue from AMP-008 and other complex generic launches, Amphastar is predicted to experience growth in EBITDA, enhanced by the margin-expansive impact of Baqsimi. Baqsimi is another product in the company's portfolio that has been contributing to its financial performance.
Piper Sandler's stance reflects optimism about Amphastar's potential for considerable longer-term EBITDA growth, underpinned by the company's strategic focus on complex generics and the recent FDA approval of AMP-008.
InvestingPro Insights
As Amphastar Pharmaceuticals (NASDAQ:AMPH) gains traction with the FDA approval of its generic inhalation product, AMP-008, investors are closely watching the company's financial metrics.
According to InvestingPro data, Amphastar boasts a market capitalization of $2.13 billion, with a P/E ratio of 13.51, which adjusts slightly to 13.74 when considering the last twelve months as of Q1 2024. This valuation is supported by a robust revenue growth of over 30% during the same period, emphasizing the company's upward trajectory.
InvestingPro Tips highlight that Amphastar's management has been actively repurchasing shares, a sign of confidence in the company's future prospects. Moreover, the company's valuation implies a strong free cash flow yield, further underpinning its financial health. It is worth noting that while three analysts have revised their earnings expectations downwards for the upcoming period, the company's liquid assets exceed its short-term obligations, and analysts remain confident in its profitability for the year.
For investors seeking to delve deeper into Amphastar's financials and future outlook, there are additional InvestingPro Tips available at https://www.investing.com/pro/AMPH. Moreover, for those interested in an InvestingPro subscription, use coupon code PRONEWS24 to receive an extra 10% off a yearly or biyearly Pro and Pro+ subscription. With 9 more tips listed on InvestingPro, subscribers can gain a comprehensive understanding of Amphastar's investment potential.
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