On Tuesday Veropharm posted its preliminary operating results for 1H 2008. The statement says finished product sales shot up by 50% y-o-y to USD 86.5 million, with more than USD 56.4 million earned on prescription medicine sales, which soared by over 81% y-o-y.
Other sales by the company also grew dramatically, with the exception of sales of traditional medicinal preparations. Plaster sales specifically jumped by 40% and those of non-prescription drugs by 54%.
We are generally upbeat on the company's operations in the first half of the year. Veropharm continues to expand sales and launch new medicines on the market, which could help widen profit margins. 1Q revenue growth, by comparison, remained under 45%.
In our view, Veropharm shares are now fairly valued on the market. However, the upbeat operating results may lend support to the company's stock valuations in the near future. Our target price for Veropharm is USD 48.7 per share.
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