Broker snap: Astra's guidance cut comes as a surprise, says Jefferies

26th Apr 2012 11:11

Jefferies has maintained its cautious stance on pharmaceuticals giant AstraZeneca after the group missed consensus revenue estimates by eight per cent in the first quarter.Revenues came in well below market expectations, falling 11% to $7.349bn, compared with Jefferies forecasts of $7.58bn and consensus predications of $8.02bn. Meanwhile, core earnings per share dropped by 19% to $1.81, above estimates but full-year guidance range was lowered by 2.4% at the mid-point.Furthermore, the company also announced that Chief Executive David Brennan would retire in June. "Whilst we had pointed out previously that consensus revenue estimates were too high, the CORE EPS guidance cut and management change announcements were a surprise.""We expect the shares to trade down 3-5% before finding solid yield support," the broker said.Jefferies has reiterated its hold rating and 2,841p target price on the stock today.Shares were down 5.42% at 2,687p by 11:10 on Thursday morning.BC