Zacks Investment Research downgraded shares of Celgene Corporation (CELG) from OUTPERFORM to NEUTRAL on March 09, 2012, with a target price of $78.00.
Celgene's fourth quarter 2011 adjusted earnings of $0.93 per share were below the Zacks Consensus Estimate by $0.02. Higher than expected expenses were primarily responsible for the earnings miss in the quarter. The company also missed revenue estimates. We expect operating expenses to increase since the company is investing heavily in its pipeline. Even though pleased with the overall oncology portfolio at Celgene, we remain concerned about the decline in the sales of cancer drug, Thalomid. We are also concerned about the loss of exclusivity of Vidaza in the US which has the potential to hamper sales if generic competition becomes significant. Consequently, we revert to a Neutral stance on the stock.
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