Shares in GlaxoSmithKline (GSK) fall 1.4 percent, with the drugmakers the biggest negative weight on a 0.4 percent firmer FTSE 100 index, as the group warns that sales in 2012 will be flat and posts below-forecast second-quarter results.
GSK’s turnover fell 4 percent from the same period a year ago to 6.46 billion pounds, generating “core” earnings per share (EPS) down 5 percent at 26.4 pence.
Analysts, on average, had forecast sales of 6.70 billion pounds and core EPS of 27.4p, according to Thomson Reuters I/B/E/S.
“Overall, a slightly disappointing quarter for GSK with a slight miss both on revenues and EPS, but this is not very unexpected - GSK had clearly been signaling a weaker Q2 was likely. The longer-term growth with GSK continues to look comparatively good,” Bernstein Research says in a note.
The brokerage retains its “market-perform” rating on GSK with a price target of 1,588 pence.
“The company has a comparatively robust revenue and EPS profile through 2015 - without having had to do a major pharma merger lately - but its valuation seems to reflect this already, and this is our only real apprehension with the name,” Bernstein adds.
Peer AstraZeneca, which will report its second-quarter numbers on Thursday, fell 0.7 percent, while the other blue chip drugmaker Shire, which posts its results next Wednesday, shed 1.1 percent.
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