Impax Laboratories Upgraded to BUY

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David Evanson and Randall Stanicky, Winter, 2012

Canaccord Genuity specialty pharmaceutical analyst Randall Stanicky upgraded his Impax Laboratories (IPXL) rating to BUY from HOLD and raised IPXL’s price target 33% to $28, from $21. Mr. Stanicky noted five drivers to his theses:

(1) Headwinds reverse and catalysts emerge – FDA remediation is key, but other drivers are coming
Image representing Impax Laboratories as depic…

(2) Our 2013+ forecasts are now well above the Street, and we think investors are beginning to look beyond 2012

(3) IPX-066 on track with first brand product approval likely a late 2012 event and little NPV reflected in the stock

(4) Under-estimated generic pipeline next year and beyond – supported by our recent meetings with management

(5) Valuation support into the high $20s – [Sum of the Parts] and [Discounted Cash Flow] provide further comfort, which are helped by our now-higher 2012 to 2015 forecasts.