DAVY VIEW

COVID-19 aside, FY 20 looks like a strong year of growth for Clinigen, with good underlying performances called out across the three divisions. Improving cash flow dynamics boosted cash conversion and net debt came in as expected. The outlook for FY 21 is more sombre, with competitive headwinds for COVID-19 and the drug Foscavir set to impact group performance, although we expect a recovery in FY 22. We expect to reduce our FY 20 and FY 21 EPS estimates by c.3% and c.8% respectively. This puts the stock on a FY 21 P/E of c.12.4x. We reiterate our ‘Outperform’ rating.