Zacks Investment Research upgraded shares of Salix Pharmaceuticals, Ltd (SLXP) from NEUTRAL to OUTPERFORM on July 24, 2012, with a target price of $62.00.
Salix started the year on a strong note with first quarter results exceeding expectations. The company posted first quarter earnings of $0.67 per share, well above the Zacks Consensus Estimate of $0.54 and the year-ago earnings of $0.34. Revenues, which increased 61.6% to $171.1 million, exceeded the Zacks Consensus Estimate of $168 million. Xifaxan continues to perform well and should keep driving growth. We believe Salix will continue seeking suitable in-licensing opportunities in order to grow revenues. With the company raising its 2012 earnings guidance, earnings estimates have gone up significantly. We are upgrading Salix to Outperform – we expect Xifaxan to continue performing well and drive growth. The stock carries a Zacks #2 Rank (short-term Buy' rating).
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