(Citi) Shire Pharmaceuticals (SHP.L) — So far so good. Shares

Shire Pharmaceuticals (SHP.L) — So far so good. Shares discounting significant hemophilia erosion
Western Europe | Pharmaceuticals, Biotechnology | Buy
What's new? We hosted Shire at our 2016 European Healthcare Reverse Roadshow. Key topics included Xiidra, hemophilia, R&D, and US pricing. Baxalta marks a big step for Shire becoming a leader in rare disease (>65% of 2020e sales) and we value the combination at £70/share (WACC 8%, g=0%) with a bullbear of £82-33. We continue to believe headline risks from ACE910 (Ph III inhibitor-segment data expected early 2017 with non-inhibitor data in 2018) are baked into the share price. On our estimate, to get to the current share price requires an assumption Baxalta's hemophilia franchise declines up to -10% into perpetuity due to rising competition. We view this as pessimistic given underlying volume growth for the hemophilia market, pricing stability and pipeline considerations. Shire trades on ‘17 PE of c.12x for a 20% 17-22 EPS CAGR, we are 5-35% ahead of consensus. Xiidra: so far so good — While early in...

>>> Swedish shareholder association prefers ZF's offer Haldex over Knorr-Bremse'

Swedish shareholder association prefers ZF's offer Haldex over Knorr-Bremse's (translated)

The Swedish shareholder association, Aktiespararna, prefers ZF's offer for Swedish brakes systems company Haldex overKnorr-Bremse's, according to Dagens Industri.
The Swedish business daily cited a representative for the association, Asa Wesshagen, who said that Aktiespararna believes that Haldex's shareholders should either sell their shares on the stock exchange or accept ZF's offer.
She said that the association believes that the regulatory investigations for the Knorr-Bremse will take time which costs money and it is also more likely that the offer will fail. She added that the recommendation is not set in stone and that it could change if new information comes to light.
The paper reported that the announcement from Aktiespararna could significantly affect the ongoing bidding war for Haldex.

>>> Ubisoft looks for help from Govt of Quebec to derail Vivendi's takeover atte

Ubisoft looks for help from Govt of Quebec to derail Vivendi's takeover attempt

Ubisoft Entertainment, the France-based video game publisher, has reached out to the Government of Quebec for assistance in its attempt to derail a takeover attempt by Vivendi, the France-based media and content company, reported The Globe and Mail on its website Monday.
The report said that Quebec Premier Philippe Couillard's government is keeping an eye on the situation but is unable to get involved in such a situation that pertains to two private sector businesses. The report added that Ubisoft employs approximately 3,000 people in the province.
Meanwhile, the report indicated that a potential showdown could materialize on Thursday when Ubisoft holds its annual general meeting, which is slated for Paris, France.
According to the report, Vivendi, which has established a stake of more than 20% in Ubisoft, has requested seats on the company's board of directors.
As well, Vivendi has indicated that it wishes to talk to Ubisoft in a non-hostile fashion, insisting that it is not open to contemplating a 100% takeover of Ubisoft until, at the earliest, sometime next year.
Meanwhile, the report said that Ubisoft does not wish to add Vivendi to its board since it believes that Vivendi would, among other things, get in the way of its strategy.
The report cited Quebec Minister of Economy, Science and Innovation Dominique Anglade as saying that a hostile takeover attempt is never the best option. Anglade added that the provincial government's priority is to keep jobs in the province.
According to the report, Ubisoft announced in February that it was on the lookout for Canadian investors to help it fend off Vivendi. The takeover target, noted the report, spoke with approximately 12 possible investors. Unidentified sources have said that the Government of Quebec's investment arm, Investissement Québec, was one of the parties that Ubisoft contacted.
In addition to trying to find Canadian investors, Ubisoft has pursued other strategies to derail Vivendi's plans. For instance, Ubisoft's founding Guillemot family upped its stake to around 13% of capital and nearly 22% of voting rights. As well, the company obtained the support for its objectives from important shareholders.
Wedbush Securities analyst Michael Pachter said in the report that Ubisoft will pull out all of the stops to stay independent, which could mean merging into another entity as a standalone unit. The analyst added that Take-Two Interactive Software of New York, New York could be open to such a deal.

>>> Proton gets VW Group and Geely to enter bidding process

Proton gets VW Group and Geely to enter bidding process – report

Proton Holdings, the car manufacturing unit of DRB-Hicom [KLSE:1619], a Malaysian conglomerate, is getting VW Group, the German carmaker, and Geely, the China based company, to bid for a stake in the Malaysian carmaker, The Star reported.
The report, citing an unnamed source, said that the two carmakers were among several companies, namely Renault, PSA Peugeot-Citroen and Suzuki, looking to acquire a stake in Proton.

>>> What to look at today - 27th of September 2016

Dow-0.91% S&P -0.86% Nasdaq -0.91% Russell-1,09%
US Market closed lower ahead of first Clinton/ Trump debate. Pressure came from Europe after financials weakness pushed by DBK, The stock tumbled 7.1% and ended at a fresh all-time low. Participants favored a risk-off stance throughout the session, bidding Treasuries, gold, and safe-haven currencies. The CBOE Volatility Index (VIX 14.49, +2.20) jumped more than two points as investors sought some portfolio insurance ahead of some key macro events. Ten sectors ended in the red with consumer discretionary (-1.1%), health care (-1.2%), and financials (-1.5%) acting as the largest laggards. Conversely, defensively-oriented real estate (+0.2%) finished with the only gain. DIS -1.4% on news they could bid for TWTR. Volume were below average with 775mil shares. US after Hours SNX +8% and THO +1.4% higher following earnings/guidance, INFI +14% / PIRS +13% / KITE +10% on trial data news... SXL -6% on acquisition / offering news. US Future trading higher after the first debate as Clinton looked better. In Asia, China industrial profit growth widens to 19.5% V 11.0; Stats bureau keeps expectations in check by referencing low y/y base and warning about soft internal/external demand; PIMCO concerned over high China corporate debt.

Nikkei +0.52% Hang Seng +1% CSI +0.07% Shanghai -0.17%

Eur$ 1.1245 CNH 6.6804 CNY 6.6697 JPY 100.86 GBP 1.2977 CHF 0.97 RUB$63.7372 WTI 45.86 -0.17%

S&P +0.56% EuroStoxx +0.74% FTSE +0.62% Dax +0.64% SMI +0.40%

Macro :
- ECB’s Coeure Says He’s Not in Favor of Buying Bank Bonds: SZ
- Clinton, Trump Draw Stark Contrasts With Sharp Debate Attacks
- Mexican Peso Jumps, Gold Retreats as Clinton Seen Taking Debate

Keep an eye on :
- AC FP : Accor Plans to Create Youth Hostel Chain, Le Figaro Says
- BAYN GY : Mylan, Lupin Said to Weigh Bids for Bayer Dermatology Business
- BMPS IM : Monte Paschi Says Business Plan to Be Approved Oct. 24
- CBK GY : Commerzbank Overhaul Said to Include 9,000 Job Cuts by 2020: HB
- CNA LN : Centrica Still in Process of Selling Canada Gas, Oil Assets
- ACA FP : Credit Agricole Sells EU300M Bonds Changeable for Eurazeo Stock
- ENGI FP : Engie Wins Beijing Gas Contract Worth EU200m-EU300m: Figaro
- RF FP : Credit Agricole Sells EU300M Bonds Changeable for Eurazeo Stock
- FFP FP : Peugeot-Family Holding FFP Names Bertrand Finet to Mgmt Board
- GNFT FP : Genfit 1H Net Loss Widens, Co. Must Raise Funds for Elafibranor
- NOVOB DC : Novo Nordisk May Resume Double-Digit Growth From 2019: Thomsen
- ORA FP : Orange Belgium Names Arnaud Castille CFO; Werner De Laet Returns
- RBI AV : Raiffeisen CEO Says ‘Smaller’ Issues Left to Resolve on RZB
- ROG VX : Roche Gets 510(k) FDA Clearance for Treponema Pallidum Assay
- RWE GY : RWE’s Innogy IPO Has Demand for All Shares on Offer: Terms
- LOCAL FP : SoLocal Holders Group Plans Resolution to Oust Board: Figaro
- STL NO : Statoil Cancels West Epsilon Contract W/ North Atlantic Drilling
- GLE FP : France May Consider Partial Cut of SocGen Tax Rebate: Tribune
- HO FP : Thales Denies Railway Signalling Unit Was Ever Put Up for Sale

>>> Europe : Brokers Upgrades & Downgrades - 27th of September 2016

>>> Up
*ASHTEAD RAISED TO NEUTRAL VS UNDERPERFORM AT CREDIT SUISSE
*DIALOG SEMI RAISED TO BUY VS ADD AT ALPHAVALUE
*FRESNILLO RAISED FROM UNDERWEIGHT TO EQUAL WEIGHT AT MORGAN STANLEY
*KERING RAISED TO BUY VS NEUTRAL AT GOLDMAN
*ORANGE RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*TARGA RESOURCES CORP RAISED TO OVERWEIGHT AT BARCLAYS

>>> Down
*EON CUT TO EQUALWEIGHT VS OVERWEIGHT AT BARCLAYS
*GEMALTO CUT TO SELL VS HOLD AT BERENBERG
*SAGA CUT TO HOLD VS BUY AT CANACCORD
*SMURFIT KAPPA CUT TO HOLD VS BUY AT JEFFERIES

>>> PT Change


>>> Initiation
*NOVOZYMES RATED NEW SELL AT BERENBERG, PT DKK250
*SYNERGY RESOURCES CORP RATED NEW OUTPERFORM AT RBC CAPITAL

>>> Call
>> Stock
*ALROSA REMOVED FROM CEEMEA FOCUS LIST AT GOLDMAN
*CAPITAL STAGE ADDED TO BANKHAUS LAMPE SMALL-CAP ALPHA LIST
*HEIDELBERGCEMENT, INFINEON ADDED TO BANKHAUS LAMPE ALPHA LIST

>>> US After Hours Summary: SNX +8% and THO +1.4% higher following

After Hours Summary: SNX +8% and THO +1.4% higher following earnings/guidance, INFI +14% / PIRS +13% / KITE +10% on trial data news... SXL -6% on acquisition / offering news

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SNX +7.8% (also increased quarterly cash dividend), THO +1.4%

Companies trading higher in after hours in reaction to news: INFI +14.4% (presents new preclinical data for IPI-549 that "appear favorable"), PIRS +13.1% (Pieris Pharmaceuticals presents 'positive' data for its bispecific drug candidate, PRS-343), KITE +10.2% (announces positive topline KTE-C19 data from ZUMA-1 pivotal trial in patients with aggressive non-hodgkin lymphoma (NHL) -- Study met primary endpoint with combined complete response rate of 39% at three months), NYRT +8.2% (files for 3,452,7 share common stock offering by selling shareholders; retains Spencer Stuart for independent Board Of Directors candidate search), BLDP +6.3% (announces that automotive OEM Audi AG has issued purchase orders to accelerate certain key development activities), JUNO +4.4% (following KITE's CAR-T data), HEAR +4.3% (light volume, restructuring Hypersound business to substantially lower operating costs), NAVB +4.1% (appoints Michael Goldberg, M.D. President and Chief Executive Officer and Eric Rowinsky, M.D. as Chairman), RMP +2.8% (ticking higher, will purchase the acquired midstream assets from Rice Energy for $600 mln. The transaction is expected to close in the fourth quarter of 2016, subject to customary closing conditions), DRRX +2.6% (after Monday's 30%+ decline on CRL news), AGRO +2.4% (extends share repurchase program for and additional twelve-month period ending on September 23, 2017), PTIE +1.5% (after Monday's 50% decline on CRL news), DTE +0.4% (to purchase 100% of Appalachia Gathering System; increased its 2016 operating earnings guidance)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: N/A

Companies trading lower in after hours in reaction to news: SXL -5.7% (to acquire Vitol's crude platform for about $760 mln plus working capital; commenced an underwritten public offering of 21 mln common units pursuant to an effective shelf registration statement on Form S-3 previously filed with the SEC), NAT -5.6% (announced an underwritten public offering of 11 mln common shares), MPW -3.7% (to acquire the real estate interests of nine acute care hospitals operated by Steward Health Care System; commences 33.5 mln common stock offering), MYOK -3.7% (announces underwritten public offering of 3,800,000 shares of its common stock), RICE -0.4% (to acquire Vantage Energy for ~$2.7 bln; commences a 40 mln share underwritten public offering of common stock)

>>> Asian Update

Asia Mid-Session Market Update: Mexican Peso rises over 1.5%, SPY futures rally 0.5% during first presidential debate; China industrial profit growth expands

***Asia Notes/Observations***
- If Mexican Peso is the barometer of debate performance, Clinton had a better night as MXN rallies over 1.5% over the course of the 90-minute encounter
- S&P futures also rise about 20 handles (0.6%) and USD/JPY up some 70pips above 100.80; Sector performance (healthcare/biotech, defense, gun makers) on Tuesday should add more clarity.
- China industrial profit growth widens to 19.5% V 11.0; Stats bureau keeps expectations in check by referencing low y/y base and warning about soft internal/external demand; PIMCO concerned over high China corporate debt.

***Top US session headlines***
- Deutsche Bank shares weigh on global bank sentiment
- Crude prices rise while producers arrive in Algiers cautiously optimistic
- (US) AUG NEW HOME SALES: 609K V 600KE; increase in sales of lower-priced homes is main factor for drop in median and average prices
- Fed's Kaplan: US is not trapped in world of low interest rates; still seeing some slack in the labor market
- TWTR: Disney reportedly working with adviser on bid for Twitter - press

***US markets on close: Dow -0.9%, S&P500 -0.9%, Nasdaq -0.9%***
- Best Sector in S&P500: Utilities
- Worst Sector in S&P500: Healthcare
- Biggest gainers: RIG +4.6%, DO +2.8%, MUR +2.2%, STX +2.0%, AZO +1.9%
- Biggest losers: MNK -6.8%, ENDP -6.0%, FOSL -5.2%, KORS -5.0%, SIG -2.7%

***VIX 14.50 (+2.2pts); Treasuries: 2-yr 0.74% (-2bp), 10-yr 1.59% (-3bp), 30-yr 2.33% (-1bp)***

***US movers afterhours***
- KITE +10.3%: Announces positive topline KTE-C19 Data from ZUMA-1 pivotal trial in patients with Aggressive Non-Hodgkin Lymphoma (NHL)
- SNX +7.8%: Reports Q3 $1.73 v $1.56e, R$3.67B v $3.49Be
- THO +1.3%: Reports Q4 $1.57 v $1.37e, R$1.29B v $1.28Be

***After extended session***
- N: Oracle receives Department of Justice clearance to buy NetSuite

***Equity Futures (23:00ET): S&P e-mini +0.5%, Dax +0.4%, FTSE100 +0.4%***

***FX / Commodities ranges (23:00ET):***
- EUR 1.1237-1.1252; JPY 100.10-100.80; AUD 0.7610-0.7670, NZD 0.7260-0.7290
- USD/CNY: (CN) PBOC SETS YUAN MID POINT AT 6.6646 V 6.6744 PRIOR
- Gold -0.4% at 1,339/oz; Oil -0.2% at $45.81/brl; Copper -0.7% at $2.18/lb

***Asian Equity Markets (23:00ET)***
- Nikkei -0.3%, Hang Seng +0.7%, ASX -0.7%, Shanghai +0.1%, Kospi +0.3%

***Key economic data:***
- (CN) CHINA AUG INDUSTRIAL PROFITS Y/Y: 19.5% V 11.0% PRIOR; YTD: 8.4% V 6.9% PRIOR
- (JP) JAPAN AUG PPI SERVICES Y/Y: 0.2% V 0.3%E

***Speakers / Press / Key Themes***
China:
- (CN) China NBS: Aug industrial profit growth due to low base; Domestic and overseas demand still insufficient
- (CN) BlackRock head of China equities: Expect China economy to have a soft landing - financial press
- (CN) NDRC official: China to consider a carbon tax starting in 2020 - Chinese press
- (CN) PIMCO: China corporate debt relative to GDP well exceeds 100%; Companies are most extended in absolute terms - financial press

Japan:
- (JP) Japan Fin Min Aso: hopes to pass budget to escape from deflation
- (JP) Bank of Japan (BOJ) July 28th Policy Meeting Minutes: Inflation expectations had weakened recently; ETFs purchase increase was to offset sentiment risks; Agree that BOJ should review comprehensively in Sept for uncertainty over price outlook
- JGB: (JP) Japan MoF sells ¥499B in 0.4% 40-year bonds, bid to cover: 2.73x v 2.89x prior

Australia:
- (AU) HSBC: Slowing Australia mortgage loans and credit growth suggest overall cooling in housing market - AFR
- (AU) Australia MoF (AOFM) sells A$150M in 1.25% 2022 Bonds; avg yield: 0.3018%; bid-to-cover: 2.27x

***Asia movers***
- Consumer discretionary: Wanda Cinema 002739.CN -0.5% (parent group said to acquire Dick Clark Productions); Flight Centre FLT.AU -2.0% (acquisition)
- Consumer staples: Coca-Cola East Japan Co 2580.JP +0.8% (two Coca-cola bottlers to merge)
- Financials: China Pacific Insurance Group Co 2601.HK -0.2% (HSBC raised to Hold); Medibank MPL.AU -3.4% (Blackrock no longer as substantial holder); Charter Hall REIT CQR.AU -0.4% (Citi raised to Neutral)
- Industrials: Lintec Corp.7966.JP -0.2% (H1 result); Mitsui Chemical Inc 4183.JP +4.5% (Credit Suisse raised to outperform)
- Technology: NEXTDC NXT.AU -2.3% (revises outlook); Otsuka Corp 4768.JP -0.4% (9-month result speculation)
- Materials: Mitsui Chemicals 4183.JP +4.5% (Credit Suisse upgraded to Outperform); Newcrest Mining NCM.AU +2.2% (Goldman raised to Buy); Fortescue Metals Group FMG.AU -1.5% (Morgan Stanley cuts to underweight); Medibank MPL.AU -3.4% (nickel declined)
- Healthcare: Dainippon Sumitomo Pharma 4506.JP +5.2% (Readying cancer treatment napabucasin for release)
- Telecom: HKBN 1310.HK -0.7% (bids for Wharf's asset)