Broker snap: Glaxo's Q2 misses, but Jefferies stays positive

25th Jul 2012 16:10

Jefferies has maintained its 'buy' rating and 1,600p target price for pharmaceuticals giant GlaxoSmithKline in despite of the second-quarter miss, but says that any falls in the stock should be seen as a buying opportunity."The well flagged weakness in the Q2'12 earnings should not come as a major surprise to anyone, though revenues and CORE EPS still missed consensus expectations by 3% and 2% respectively," the broker said.Meanwhile, sales and margin growth guidance for the full year have been lowered to 'flat' at constant exchange rates. Nevertheless, the group is responding with £500m of further cost cutting by 2015 and expect to drive further efficiencies in the 2012 tax rate."Despite the disappointing quarter, GlaxoSmithKline's ability to respond to the situation along with expectations of longer term growth mean we would especially use any weakness to pick the stock up for both the long-term growth and progressive dividend."By 16:09, shares were down 1.45% at 1,424.5p.BC