Roche
Note: This is a daily stock update and the information stands true as of 22/04/25, 09:00 CET.
Company Update:
Expert Opinion:
Our expert does agree with our analyst and believes this is a positive. The US is the largest market in the world and the prospect of having restrictions to access that market was indeed a negative (hence the sharp negative reaction of Roche and the whole sector since the announcement of potential tariffs on drugs). With that investment, Roche will be able to retain a significant position on the US market. In an ideal free trade world, there would be no need for such investments and companies should be able to produce in the most efficient places but we are not in such a world. The $50bn investment is spanning over 5 years and therefore there could be opportunity to enhance or modify the plan should the trade situation evolve. Roche is back to very attractive pricing levels trading at a PE25 of 12.54x and PE26 of 11.8x. Still a key buy in the sector in our expert's opinion.
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Company Update:
After Novartis, now Roche has announced to invest $50bn, over the next five years, towards new manufacturing and R&D facilities in the US. This is on top of Roche’s 13 manufacturing sites and 15 R&D centers in the US – across Pharmaceutical and Diagnostics segments. Moreover, Roche’s presence in the US is across the value chain. After the new and expanded manufacturing facilities become operational, Roche is expected to become a net exporter of medicines from the US. In Diagnostics, the firm already has an export surplus for the US.
Overall, it appears that Donald Trump’s pressure tactics via tariffs threats, is bearing fruits and some of the Big Pharmas have started to announce their investment plans in the US. We expect a positive share price reaction for Roche today.
Our expert does agree with our analyst and believes this is a positive. The US is the largest market in the world and the prospect of having restrictions to access that market was indeed a negative (hence the sharp negative reaction of Roche and the whole sector since the announcement of potential tariffs on drugs). With that investment, Roche will be able to retain a significant position on the US market. In an ideal free trade world, there would be no need for such investments and companies should be able to produce in the most efficient places but we are not in such a world. The $50bn investment is spanning over 5 years and therefore there could be opportunity to enhance or modify the plan should the trade situation evolve. Roche is back to very attractive pricing levels trading at a PE25 of 12.54x and PE26 of 11.8x. Still a key buy in the sector in our expert's opinion.
For daily updates, subscribe to our newsletter and for detailed information, reach out to us at sales@alphavalue.eu
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Solid start of 2025 with signs of recovery in key markets.