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Immediately (6 February) was good for shareholders of AstraZeneca (LSE: AZN). The FTSE 100‘s largest firm vaulted 5.9% increased to 11,786p after dropping a powerful set of earnings.
This helped push the Footsie as much as 8,766, a report intraday excessive. Rates of interest had been additionally lower in the present day, bringing down the price of borrowing to 4.5%. So extra beneficial properties may very well be forward.
I added to my holding within the pharma big in early November when the inventory dipped below 10,000p. This adopted information that some executives had been below investigation in China, which I suspected won’t matter 5 years from now. We additionally acquired information about that in the present day.
Robust development and surging earnings
In 2024, AstraZeneca’s income jumped 21% yr on yr to $54.1bn on a relentless foreign money foundation. That was forward of steering for high-teens development and higher than what analysts had been anticipating ($53.1bn).
Gross sales development was robust throughout the board, with its oncology (up 24%) and respiratory and immunology (24%) divisions main the way in which. Most cancers therapies account for round 41% of complete gross sales.
Taking a look at areas, Europe (up 26% at fixed trade charges) and rising markets excluding China (32%) grew the quickest. But its largest market, the US, recorded spectacular 22% income development final yr.
On the underside line, core earnings per share (EPS) spiked 19% to $8.21, forward of forecasts ($8.15), whereas pre-tax earnings surged 38% to $8.7bn.
CEO Pascal Soriot commented: “This yr marks the start of an unprecedented, catalyst-rich interval for our firm, an necessary step on our Ambition 2030 journey to ship $80bn complete income by the tip of the last decade.”
Whereas development’s understandably anticipated to be slower in 2025, issues nonetheless look stable. Income’s set to rise by a excessive single-digit share, with EPS growing by a low double-digit share. It wouldn’t shock me if these figures find yourself a bit increased this time subsequent yr.
Lastly, the dividend was hiked 7% final yr, although the forecast yield is simply 2.2%.
Ocean-deep medication pipeline
By my depend, AstraZeneca had 14 blockbuster medication in 2024, which implies each generated over $1bn in annual gross sales. However a handful of others are additionally getting nearer.
One motive I’m a shareholder is the corporate’s deep pipeline of progressive therapies and potential future blockbusters. Final yr, it delivered 9 constructive late-stage research and anticipates one other seven potential new medicines this yr.
This provides the corporate many pictures on purpose, although naturally some will miss the goal. Late-stage trial failures are an unavoidable threat right here, as is opposed regulation. Donald Trump’s well being secretary, the Massive Pharma critic Robert F Kennedy, additionally stays a wildcard.
In the meantime, a worldwide commerce battle triggered by Trump’s tariffs would possibly see AstraZeneca going through a bit extra regulatory scrutiny in China. Talking of which…
A drop within the ocean
What about China then? Nicely, this matter pertains to unpaid importation taxes on two most cancers medication. However the excellent news is that the corporate sees the nice for this being between $900k and $4.5m.
Whereas it’s clearly not superb to be within the dangerous books with Chinse authorities, this quantity is small potatoes for a worldwide pharma big.
As a shareholder, I’m pleased with every thing I’ve learn right here. However I’ll wait for an additional dip earlier than shopping for any extra shares.
