Sandoz Earnings: Robust Biosimilar Performance Drives Growth and Reiterates Industry Expertise

No-moat Sandoz reported strong third-quarter earnings that came above our expectations. Total sales of $2.6 billion were up 11% year over year, or 12% in constant currencies, with solid performance across regions. Against this backdrop, management raised full-year guidance from mid-single-digit to high-single digit sales growth and maintained its 20% EBITDA margin guidance. After updating our near-term outlook as well as adjusting for CHF/USD rates, we are raising our fair value estimate to CHF 39 per share from CHF 35.50.