Roche/Genentech Has a Strong Pipeline in Diagnostics and Therapeutics to Drive Moderate Growth in 2016
New Stock Pick: Roche Holding (RHHBY) $30.36
Over the past 3 months we recommended several new buys for the Rayno Biopharma Portfolio emphasizing moderate growth, relative safety and dividend plays. Three large cap biopharma stocks were previous picks: Abbvie (ABBV), Bristol-Myers Squibb (BMY) and Gilead Sciences (GILD). Today we add another large cap Swiss pharma Roche Holdings a leading drug and biotech Company with a dominating high growth position in diagnostics with revenues accounting for about 22% of total. Roche revenue growth should be up for 2017 at ~6% compared to previous years. Total revenues for 2015 were $50.35B with a Net income of $9.04B. Cash flow from operating activities was $15.236B.
The investment thesis for Roche is as follows:
Large cap biopharmaceutical stocks have been laggards over the past six months due to political concerns about pricing and earnings growth. Roche stock has been a laggard over the past 12 months down 14.7% so look for support above the $30 level.