GALD: Q2 preview and PT raised to CHF 175; premium valuation keeps us on sidelines

Research evidence excerpt

GALD: Q2 preview and PT raised to CHF 175; premium valuation keeps us on sidelines

Galderma Group AG

Target/Upside/Downside Scenarios Investment summary

Galderma is a focused global dermatology business withGalderma Group AG

notable strengths in injectable aesthetics, where it holds the

220 120 Weeks 22MAR24 - 07JUL26 #2 position by share (behind Allergan) but has been gaining

200 share in recent years.

180 CURRENTCURRENT 176.55176.55

160 TARGETTARGET 175.00175.00

140 Post-IPO the company plans to continue gaining share

120 in injectable aesthetics, with biostimulator Sculptra as an

100 important growth driver. In addition, we expect Relfydess to

60 be an important upgrade to Dysport, launching well so far in

40 international markets.

60m

40m 20m The company has a vital new product launch in the therapeutic

2024 2025 2026 space in Nemluvio, on track to be a blockbuster treatment for

M A M J J A S O N D J F M A M J J A S O N D J F M A

M J J diseases characterised by severe itching (atopic dermatitis and GALD SW Rel. SWISS MARKET INDEX MA 40 weeks

Source: Bloomberg and RBC Capital Markets estimates for Target prurigo nodularis).

Valuation The combination of Nemluvio and Relfydess should help

Due to Galderma's business mix, which includes significant Galderma deliver its target of significant EBITDA margin

elements of consumer care alongside biopharmaceuticals, expansion to 2027, where it has updated guidance to

we use a combined valuation approach based on consensus +450-550bps at CER over 2023-27E (from +300-500bps guided

multiples for consumer and biopharmaceuticals peers. In previously).

addition, Galderma is in a strong transformation phase, which

we think should be largely complete by 2030. As a result, we We forecast a 2023-27E sales CAGR of +16%, core EBITDA