Ready to Accelerate Profit, Upgrading to Buy

研报英文原文证据摘录

Ready to Accelerate Profit, Upgrading to Buy

Japan | Pharmaceuticals

Shionogi & Co. EquityJulyResearch14, 2026

RATING | TARGET | ESTIMATE CHANGEReady to Accelerate Profit, Upgrading to Buy

We expect a significant improvement in profitability in FY3/28, driven by the RATING BUY (HOLD)

absence of Radicava inventory step-up and completion of the investment PRICE ¥2,836^

phase for Xocova. While we believe earnings are likely to remain subdued PRICE TARGET | % TO PT ¥3,800 (¥3,700) | +34%

in 1H FY3/27 as these factors continue to weigh on results, any share 52W HIGH-LOW ¥3,758 - ¥2,393

price weakness could provide a more attractive entry point ahead of the FLOAT (%) | ADV MM (USD) 82.0% | 44.01

anticipated earnings recovery. We raise our target price to ¥3,800 and MARKET CAP ¥2.4T | $14.9B

upgrade to Buy from Hold. TICKER 4507 JP

^Prior trading day's closing price unless otherwise

noted.

Radicava to drive earnings growth from 2H. The US Radicava business, which has been

consolidated since April this year, appears to carry a very high gross margin of roughly 80–90%.

However, profitability in FY3/27 is likely to be temporarily depressed by loss from inventory FY (Mar) CHANGE TO JEFe JEF vs CONS

step-up, which we estimate will reduce the gross margin by around 10%. In addition, we 2026 2027 2026 2027

expect marketing expenses to increase following the acquisition and integration, particularly REV NM -2% -3% +2%

in 1H, preventing operating margins from reaching their normalized level. As gross margins EPS <1% +5% -21% -8%

normalize in 2H, Radicava's contribution to earnings should become increasingly evident.

2026 (¥) Q1 Q2 Q3 Q4 FY3

Xocova marketing spend likely optimized in FY3/28. Following FDA approval, Shionogi plans EPS 45.08 41.48 68.74 62.61 217.91