| Stock (Symbol) | Stock Price | |
Allergan (AGN) |
$320 |
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| Data is as of | Expected to Report | Sector |
August 19, 2015 |
Nov 3 – Nov 9 |
Healthcare |
| Sharek’s Take | ||
 Allergan is on pace to hit its goal of $25 in profits by 2017. Allergan, maker of Botox, recently merged with Actavis, based in Ireland, and is now enjoying a lower tax rate which is allowing profits to grow at an impressive rate. Last November ACT’s CEO predicted on CNBC that the combined company would make $25 in 2017. So far in 2015, the 2017 est. has grown from $24.03 to $24.61 and $25 is very reasonable. If AGN makes $25 and gets a 20 P/E the stock will be $500. Allergan has drugs in Phase II and Phase III trails, 8 of its top ten drugs continue to grow at double-digit rates, and it will also continue to acquire other drug companies (and bring them into the low tax rate). Last qtr it bought Kythera Biopharma which has a patented FDA-approved injection to reduce double chins. Allergan has been holding up well in a wicked stock market correction, and I feel it will resume its upward trend and lead this market higher when the market turns up. AGN is growing profits 30%, has a P/E of just 18, and has close to 50% upside to its 2016 Fair Value. |
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| One-Year Chart | ||
 Everything is marked in green in the one-year chart, other than the Est. LTG of 16%. But the company is growing around 30% right now. |
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| Earnings Table | ||
 Last qtr the combined Actavis/Allergan had sales increase 80% due to the merger. Profits grew 29%.AGN beat the street by just 2 cents last qtr, but had beaten by bigger margins the prior 2 qtrs. Annual Profit Estimates continue their steady climb higher. Quarterly profit growth could be great next qtr, then slow to a more reasonable rate going forward. |
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| Fair Value | ||
 AGN at 18x earnings is a bargain. Many growth stocks in today’s market have P/E’s one-and-a-half times their Est LTG (which would make AGN’s P/E 24). Excellent upside potential here, but political risk as the tax laws can change. |
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| Ten-Year Chart | ||
 This is really the Actavis ten-year chart. Profits have zoomed higher the past few years, as has the stock price. Still, AGN hasn’t gone on a parabolic move and this base it is currently building increases the stock’s safety. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
1 of 26 |
Allergan is one of my favorite stocks right now. It has certainty, consistency and growth opportunity. The stock’s holding up well in a wicked stock market correction and should lead the market higher once the uptrend resumes. AGN is ranked 1st in the 26 stock Growth Portfolio Power Rankings and first of 13 stocks in the Aggressive Growth Portfolio Power Rankings. |
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Aggressive Growth Portfolio
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