26 July 2023
If you are covering GSK’s latest financial results, please find below a comment from Sheena Berry, equity research analyst at Quilter Cheviot:
“GSK has delivered another pretty solid quarter with its earnings beating expectations and raising its underlying profit and sales guidance for the year. Crucially, all three divisions (vaccines, speciality medicines and general medicines) delivered a solid quarter, with its shingles vaccine continuing to generate robust growth and HIV medicines doing particularly well.
“The company continues to face some headwinds around the Zantac litigation. It did agree to an undisclosed settlement in June with a plaintiff for the first bellwether case in California recently, in the hopes that this would remove some of the uncertainty, however, it continues to hang over the company and this will weigh on investor sentiment until at least the next case goes to trial in November of this year.
“GSK has transformed in recent years and gives investors a compelling underlying double-digit earnings per share growth for 2023. However, Zantac is not the only overhang facing the business. An important HIV patent expires in a few years creating a headwind for the growth outlook. As a result, focus has to be on enhancing the pipeline and product offering and in the meantime rivals may look more attractive to any potential investors.”
