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| SEPRACOR INC (SEPR) |  | | Company Name: | SEPRACOR INC | | Ticker Symbol: | SEPR | | Industry: | MEDICAL-DRUGS | | Company Website: | http://www.sepracor.com/ | | Summary: NEXT PARAGRAPH NOT FOUND...more | |
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Company Overview and History
Recent Events
Reasons to Buy SEPRACOR INC
Investors Give Reasons to Buy
| If You Think SEPRACOR INC Is a Buy, Post Your Reasons Below | |
Analysts Recommending Buy
Reasons to Sell SEPRACOR INC
Investors Give Reasons to Sell
| If You Think SEPRACOR INC Is a Sell, Post Your Reasons Below | | The analysts with a negative stance believe that the company is overvalued, given its long-term generic exposure and relatively undifferentiated pipeline.
| | Last edited Tue Jun 23, 2009 12:42 AM
by MSamanta (Zacks Investment Research) |  |
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Analysts Recommending Sell
Reasons to Hold SEPRACOR INC
Investors Give Reasons to Hold
| If You Think SEPRACOR INC Is a Hold, Post Your Reasons Below | |
Analysts Recommending Hold
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| ZACKS RESEARCH | J NAPODANO | | 1/29/2009 | HOLD | | Sepracor, Inc. engages in the discovery, development, and commercialization of products primarily for the treatment of respiratory and central nervous system disorders. Sales of Sepracors key product, Xopenex and Lunesta remain weak. In fact, both should decline significantly in 2009. We see little that can be done to re-accelerate the top-line in the near-term. As a result, management made a move earlier in the year to significantly cut costs, starting with a 20% workforce reduction in January 2009. Longer-term, we continue to see little growth with the core products, but Sepracor does have an interesting mid-stage CNS pipeline that could offer the next wave of growth for management starting in 2012. However, the key question remains: Can the stock outperform as long as Lunesta and Xopenex struggle? We think not. Our target is $16.
No comments yet. Be the first | | |
How Can I Decide if SEPRACOR INC Is a Buy or a Sell?
| | How Can I Decide if SEPRACOR INC Is a Buy or a Sell? | Follow the Experts...
| | There are 8 individual(s) in the US who know more about SEPRACOR INC and its stock price than almost anyone else These 8 individual(s) are the 8 brokerage analysts who follow SEPRACOR INC and whose research is discussed above by Wiki posters who receive the research from these brokerage firms To decide if you want to buy SEPRACOR INC, you could read the discussions above and see if you find a bull or bear argument for SEPRACOR INC that you think is compelling – or you might toss a coin. To help you evaluate the credibility of the arguments made by an analyst, we have displayed the Zacks All Star Rating of the analyst after his/her name. Zacks rates analysts as 1, 2, 3, 4, or 5 STAR analysts based on the performance of their stock recommendations. The analysts with 5 STAR ratings have had the best performance. For more information on these Zacks Analyst ratings, go to http://www.zacks.com | |
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...or Make Your Own Non-Consensus Decision
| | However, we believe that there is a better way to make stock selection decisions, and this Wiki is dedicated to this technique. The better way – which is taught to all MBA students, and used by professional investors – is not easy. But it is one of the few investment techniques that actually does work. The better way requires you to find errors in the consensus forecasts of revenue and EPS. Until the creation of this Wiki, it has been virtually impossible for an individual investor to develop accurate non consensus revenue and earnings forecasts because no one individual has had enough information to accurately out-forecast the Wall Street analysts.
However, by using the Wiki to pool together the collaborative intelligence of large numbers of individuals who are familiar with the MEDICAL-DRUGS Industry, with SEPRACOR INC, and with its suppliers and customers, we as a group do have a realistic chance of finding that nugget of accurate non-consensus information.
Warren Buffett finds these nuggets. This Wiki can help you find your own nuggets.
But this process can only work for those companies and industries with which you are very familiar. To apply this process to SEPRACOR INC, you need to focus on 2 questions:- Do I agree with the consensus estimate of the future revenue of SEPRACOR INC?
- Do I agree with the consensus estimates of the EPS of SEPRACOR INC?
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How Can I Find Errors in the Consensus Forecasts for SEPRACOR INC?
| How Can I Find Errors in the Consensus Forecasts for SEPRACOR INC? | The following sections are designed to help Wiki users identify errors in the consensus revenue forecasts for the major SEPRACOR INC products. Below each consensus revenue forecast is a Wiki section reserved for users to discuss why these consensus forecasts may be high or low.
All consensus forecasts are provided by Zacks Investment Research. |
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Consensus Forecast of SEPRACOR INC Revenue in Millions
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Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
10/06 |
| $1,196.53 |
$1,225.23 |
$1,292.29 |
$1,259.76 |
$1,290.36 |
1.9% |
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Consensus Forecast of SEPRACOR INC EPS
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
| $0.04 |
$1.60 |
$1.48 |
$1.60 |
$2.85 |
$2.90 |
$2.95 |
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EPS FORECASTS
This section is designed to find errors as the consensus forecast of EPS. The consensus forecasts for the lines in the SEPRACOR INC Income Statement are shown and below each consensus forecast is a wiki section to discuss why the consensus forecast of that item may be high or low
Consensus Forecasts of Total Revenue
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
12/05 |
| 1. Total Revenue |
$820.9 |
$1,196.6 |
$1,230.2 |
$1,287.4 |
$1,255.6 |
$1,303.1 |
$1,391.6 |
$1,391.9 |
7.8% |
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Consensus Forecasts of Fully Diluted Shares Outstanding
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| Fully Diluted Shares Outstanding |
118.2 |
115.6 |
116.1 |
115.3 |
114.4 |
115.7 |
115.8 |
117.0 |
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Consensus Forecasts of Pro Forma EPS
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| Pro Forma EPS |
$0.0 |
$1.6 |
$1.5 |
$1.6 |
$2.9 |
$2.9 |
$3.3 |
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Consensus Forecasts of GAAP EPS
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| GAAP EPS |
$0.0 |
$1.6 |
$0.5 |
$3.9 |
$1.6 |
$2.2 |
$2.7 |
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Consensus Forecasts of Cost of Goods Sold
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| 2. Cost of Goods Sold |
$66.7 |
$104.7 |
$117.2 |
$126.9 |
$117.9 |
$130.4 |
$146.7 |
$161.4 |
| Percent of Revenue |
8% |
9% |
10% |
10% |
9% |
10% |
11% |
12% |
| 3. Gross Profit (1-2) |
$754.20 |
$1,091.90 |
$1,113.00 |
$1,160.50 |
$1,137.70 |
$1,172.70 |
$1,244.90 |
$1,230.50 |
| Percent of Revenue |
92% |
91% |
90% |
90% |
91% |
90% |
89% |
88% |
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Consensus Forecasts of SG & A
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| 4. SG & A |
$626.6 |
$760.9 |
$781.8 |
$760.8 |
$598.6 |
$615.5 |
$618.7 |
$589.4 |
| Percent of Revenue |
76% |
64% |
64% |
59% |
48% |
47% |
44% |
42% |
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Consensus Forecasts of Research and Development
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| 5. Research and Development |
$144.5 |
$163.4 |
$199.1 |
$236.8 |
$214.9 |
$221.4 |
$235.4 |
$225.4 |
| Percent of Revenue |
18% |
14% |
16% |
18% |
17% |
17% |
17% |
16% |
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Consensus Forecasts of Pre - Tax Income
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Dec-05 |
Dec-06 |
Dec-07 |
Dec-08 |
Dec-09 |
Dec-10 |
Dec-11 |
Dec-12 |
| 7. Pre - Tax Income |
$4.1 |
$188.6 |
$183.2 |
$190.1 |
$335.4 |
$355.4 |
$422.9 |
$437.9 |
| 8. Tax provisions |
$0.2 |
$3.7 |
$7.4 |
$5.2 |
$18.6 |
$21.0 |
$40.7 |
$110.1 |
| Percent of Revenue |
5% |
2% |
4% |
3% |
6% |
6% |
10% |
25% |
| 9. Net Income (7-8) |
$3.90 |
$184.90 |
$175.80 |
$184.90 |
$316.80 |
$334.40 |
$382.20 |
$327.80 |
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What if I Agree with Consensus Forecasts?
| What if I Agree with Consensus Forecasts? | You Can Still Make an Effective Investment Decision
| | If you agree with the above consensus forecasts of revenue and of EPS, you can still make an effective investment decision by determining that a relative valuation metric is out of line. Perhaps because of events taking place in the industry, or with other companies, you may feel that SEPRACOR INC is either undervalued or overvalued, should the consensus estimates of revenue and EPS be realized. This section of the Wiki helps you think about valuation by comparing SEPRACOR INC to some of its peers using a number of standard relative valuation metrics. This section also includes a simple discounted cash flow model for SEPRACOR INC based on the consensus forecasts. The following table should be your starting point. This shows P/E, P/Sales, and P/Cash Flow for SEPRACOR INC and for comparable companies. |
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| SEPR (SEPRACOR INC) |
$1,334.00 |
$187.87 |
40.3% |
16% |
6.35 |
1.5 |
8.8 |
Industry Mean |
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-7% |
13% |
13.79 |
15.5 |
9.5 |
| S&P 500 |
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28% |
10% |
18.65
| 1.7 |
10.3 |
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PRXL (PAREXEL INTL CP) |
$1,247.00 |
$39.31 |
12.2% |
14% |
13.88 |
0.6 |
7.0 |
ENDP (ENDO PHARMACEUT) |
$1,373.00 |
$212.25 |
26.9% |
10% |
7.89 |
1.8 |
7.3 |
PPDI (PHARMA PROD DEV) |
$1,487.00 |
$201.01 |
15.2% |
10% |
14.94 |
1.6 |
8.9 |
CF is operating cash flow plus after-tax interest expense. |
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| Discussion by Wiki Users of Relative Valuation | | No comments yet. Be the first | | |
Dividend Discount Model for SEPRACOR INC
| | The two major techniques used by fundamental analysts to evaluate the value of a stock are the relative valuation metrics such as PE discussed above and the dividend discount model (DDM) or discounted cash flow model (DCF). More information about these valuation-related topics is available here. This reference answers most of the questions investors have when they first encounter these discount approaches to determining value, such as: - What is the discount rate?
- Why does the DDM discount earnings and not dividends?
- How can I use a DDM if the company does not pay dividends?
- How do I set the terminal value? (applies only to DCF)
- How do I calculate cash flow to use the DCF model?
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What Do Insiders and Institutional Owners Say about SEPRACOR INC?
| Insiders and Institutional Owners Discuss Issues Here | | No comments yet. Be the first | | |
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Industry Analysis
Industry Outlook for Major MEDICAL-DRUGS Companies
| | adad sad sad sa Medical continues to be the leading sector in terms of positive earnings estimate revisions. The comparatively low level of economic sensitivity is a big factor for why the sector ranks so well.
Multiple companies within the sector have reported good third-quarter earnings and raised guidance. These bullish events have led to positive earnings estimate revisions by brokerage analysts. They have also allowed Medical-Biomedical/Genetics and Medical-Generic Drugs to be among the best ranked industry groups.
Investors who are interested in both groups should note that company stories matter more than in other groups. The reason is that drug approval and drug safety issues are factors that can significantly influence a stock's price. Therefore, a greater focus on company selection is required than in other industry groups.
President Obama intends to allow the federal government to negotiate on drug prices, he also wants universal coverage. It is possible that drug companies could end up seeing a greater amount of business, albeit at lower margins.
| Last edited Tue Apr 07, 2009 01:41 AM
by ShaliniSinghal (Zacks Investment Research) |  |
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SEPRACOR INC Role in the MEDICAL-DRUGS Industry
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Company Specific Investment Issues
The issues discussed in the sections below generally comprise the bulk of the content in a typical research report. Understanding these subjects is certainly important when making an investment decision for SEPRACOR INC. However, to provide the most value to Wiki users as you read and contribute to these discussions, please try and tie your comments back to their specific impact on forecasts of future Revenue, Net Income, EPS, or Cash Flow. | Discussion about Capital Structure / Solvency / Cash Flows Issues | | No comments yet. Be the first | | |
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| Discussion about Governance / Social Responsibility / Treatment of Employees | | No comments yet. Be the first | | |
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| Acquisitions/Divestures/Joint Ventures/Hot New Products/Exciting Opportunities | | COLLABORATIONS, ALLIANCES, AND ACQUISITIONS
In May 2008, Sepracor formed a research alliance with Arrow International, which will help expand the future development of its levalbuterol, arformoterol, and ciclesonide pipeline through the use of Arrow’s technology. In the first part of the deal, Sepracor and Arrow agreed to move forward into Phase III trials with a levalbuterol (Xopenex)/ipratropium product. Discussed in details earlier in the report.
In a second transaction, Sepracor gained access to Arrow’s manufacturing and U-Bend nebule technology. The agreement provides enabling technology necessary for the development of a ciclesonide inhalation solution, and the future combination of ciclesonide and arformoterol.
| Last edited Tue Jun 23, 2009 12:46 AM
by MSamanta (Zacks Investment Research) | |
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| Blow the Whistle | | Sepracor’s valuation relies heavily on Lunesta. Therefore, if Lunesta does not perform up to expectations, the stock could suffer dramatically. That apart, any safety issues with Lunesta could cause a precipitous decline in Sepracor’s stock price.
SEPR has chosen to finance its operations utilizing a considerable amount of debt. If the company is successful in its designs, this amount of leverage could result in considerable appreciation of SEPR shares. Conversely, it also has the potential to magnify the already considerable amount of substantial drug development and commercialization risk, and may therefore, have a substantial negative impact on SEPR shares if the company’s drug development programs prove unsuccessful.
| Last edited Tue Jun 23, 2009 12:45 AM
by MSamanta (Zacks Investment Research) | |
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| Discussion about Upcoming Events to Watch for That Will Impact Stock Price | | Mid 2009 Expected Phase II data of SEP-225289 in depression.
| Last edited Tue Jun 23, 2009 12:46 AM
by MSamanta (Zacks Investment Research) | |
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Created by: WikiMigrationBot.
Last Modification: Wednesday 19 of August, 2009 10:33:11 CDT by WikiMigrationBot.
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