Zacks Investment Research downgraded shares of Actavis plc (ACT) from OUTPERFORM to NEUTRAL on November 28, 2013, with a target price of $172.00.
Actavis' third quarter EPS of $2.09 was a penny short of the Zacks Consensus Estimate but up 55% y/y. Revenues of $2,013 million, up 56.6% y/y, were slightly below the Zacks Consensus Estimate of $2,043 million. With the Warner Chilcott acquisition being completed, Actavis raised its 2013 EPS outlook to $9.26 – $9.39. Revenues are now expected to be $8.6 billion in 2013 (old guidance: $8.1 billion). We view the company's acquisition of Actavis Group as a smart strategic move and are positive on the recently completed acquisition of Warner Chilcott as well. With fewer major patent expiries slated to occur in the next few years, we are encouraged by Actavis' focus on building its branded and biosimilars pipeline. While we remain optimistic about Actavis' growth prospects, we are moving back to a Neutral recommendation as the current share price reflects the positive developments.
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