Allergan upgraded to Buy at Stifel; tgt $200
Stifel upgrades AGN to Buy from Hold and sets target price at $200. AGN continues to resist overtures from VRX (at $72/share cash, 0.83/1.227 exchange ratio). The total value ranges between $175-180 and $220+, considering the theoretical PF value of the combined AGN-VRX entity. AGN maintains that VRX's offer is "grossly inadequate" and has pursued its own strategy to enhance value by 1) driving business performance, 2) executing a restructuring plan, 3) generating pipeline value, and 4) pursuing capital allocation through B/S leverage (with M&A as the ultimate strategy). They believe that AGN retains several options at its disposal to generate greater shareholder return than the VRX offer. They look for developments prior to the 12/18/14 Special Meeting.