Jefferies ups AstraZeneca to 'buy', says it's at a 'turning point'

The bank said that accelerating new product launches and improving margins should deliver more than 20% core earnings per share growth in the mid-term.

"As one-off externalisation contributions decline core EPS quality is also improving, whilst the dividend once again becomes covered by the underlying business. Recovering growth, driven by the underlying business warrants a modest mid-term premium valuation."

Jefferies said several years of rebuilding the pipeline is now coming to fruition as new product launches build momentum.

After updating its model, the bank's mid-term revenue forecast is around 6% ahead of consensus.

"Our expectations for Lynparza, Brilinta, Farxiga and Fasenra are key drivers of this, reflecting the benefit of further indication expansion over the mid-term. Furthermore, over half the sales that we forecast to come from new and recently launched products between 2017A-22E, are generated by products that are already launched, or have already reported positive Phase III data, helping to de-risk expectations."

At 1530 GMT, the shares were up 0.3% to 34.71p.