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Sanofi stock price moves higher on a £500 million vaccine deal
Shares of Sanofi (EPA: SAN) gained around 1% today after the UK government agreed to buy $500 million worth of COVID-19 vaccines from Sanofi and GlaxoSmithKline (LON: GLK). Moreover, the French giant raised its 2020 earnings forecast today.
Fundamental analysis: Earnings forecast upgradedSanofi, the world’s fifth-largest pharma company by prescription sales, upgraded its 2020 earnings forecast today after reporting a surge in the income. The French giant said its net income rose 5.6% to 1.6 billion euros in the second quarter.
This was possible due to the cost-cutting measures that saved 990 million euros in the first half of the year. Last month, the French drugmaker announced plans to slash 1,680 jobs in order to minimise costs and boost profits.
Moreover, the company generated $11.7 billion from selling shares in Regeneron two months ago. As a result, Sanofi said it now expects earnings per share growth of 6-7% this year, up from 5%.
“I’m proud of what the team delivered in the second quarter. Even with some headwinds from the COVID-19 pandemic, we achieved business EPS growth,” Sanofi Chief Executive Officer, Paul Hudson said.
Sanofi reported that its revenue slid 3.4% to 8.2 billion euros. This was mostly due to a 6.8% decrease in vaccine sales amid limited international travel and an 8% plunge in consumer healthcare business’ sales.
Separately, the UK government announced it struck a deal to buy 60 million doses of potential COVID-19 vaccine from GSK and Sanofi in a deal worth £500 million.
“With our partner GSK, we are pleased to co-operate with the UK government as well as several other countries and global organisations as part of our ongoing efforts to develop a safe and effective vaccine and make it available as quickly as possible,” said Thomas Triomphe, executive vice-president and global head of Sanofi Pasteur.
Technical analysis: Stock price bounces off supportSanofi stock price gained around 1% after the French giant upgraded its earnings forecast. Shares are now trading around the 90.00 mark, a few days after posting a 5-year high near the 96.00 handle.
Sanofi stock weekly chart (TradingView) Profit-taking pushed Sanofi share price lower to hit important support – consisting of the 100-DMA, 200-DMA, and diagonal trend line – at 87.50. This provided a buying opportunity for investors which quickly moved to push the price action around 3% higher.
SummarySanofi said its net income rose 5.6% in the second quarter, which prompted the firm to raise earnings per share growth of 6-7% this year, up from 5%. Moreover, the French drugmaker agreed to sell 60 million doses of potential COVID-19 vaccine together with GSK to the UK government in a deal worth £500 million.
The post Sanofi stock price moves higher on a £500 million vaccine deal appeared first on Invezz.
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