Berenberg hikes target price on Astrazeneca

Berenberg expects Astrazeneca to state a new revenue ambition at its 21 May investor day, highlighting confidence in growth to 2030 from already visible assets. High single-digit growth would equate to a roughly $75.0bn-80.0bn top line and approximately 20% upside to consensus, it noted.

"On our estimates, global large pharma is on track to grow sales at 4% pa for 2026-30 (range -2% to 13%) with an average 2025 P/E of 16.6x (range 7-42x). High single-digit growth would put Astrazeneca at the top end of the non-obesity range and warrant a multiple above 20x, in our view," said Berenberg.

The German bank stated it was raising its price target to reflect "recent, positive pipeline updates", which implies a 2025 price-to-earnings ratio of 19x.

"We reiterate our 'buy' recommendation as positive pipeline momentum through to 2025 has the potential to unlock sales upgrades and share price upside," said Berenberg.

"Astrazeneca offers top-tier sales growth at an attractive valuation, with a P/E of 17.4x 2025E versus an EU sector average of 15.7x and EV/NPV of 1.05x versus an average of 1.01x"

Reporting by Iain Gilbert at Sharecast.com