Zacks Investment Research downgraded shares of Amgen Inc. (AMGN) from OUTPERFORM to NEUTRAL on January 21, 2013, with a target price of $86.00.
Amgen's third quarter EPS of $1.66 per share was 23 cents above the Zacks Consensus Estimate and 19.4% above the year-ago period. Higher revenues, cost discipline and a lower share count contributed to the year-over-year increase in earnings. Revenues increased 9.5% to $4,319 million, well above the Zacks Consensus Estimate of $4,199 million. While we are encouraged by the company's performance, we remain concerned about Amgen's dependence on Prolia/Xgeva for long-term growth. With several key products expected to lose patent protection in the next few years, Amgen has a lot riding on Prolia/Xgeva's successful commercialization and label expansion. We are moving back to a Neutral recommendation on the stock with a target price of $86.00.
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