Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>Zoetis Inc.'s results were a major disappointment as it failed to meet Wall Street's revenue and earnings expectations.</li><li>Despite ongoing challenges in the Chinese market, the company achieved an 8% operational growth in revenue and a 13% operational growth in adjusted net income.</li><li>The company expects double-digit operational growth in the companion animal portfolio and low single-digit operational growth in the livestock portfolio.</li></ul>

Zoetis Inc.'s results were a major disappointment as it failed to meet Wall Street's revenue and earnings expectations.Despite ongoing challenges in the Chinese market, the company achieved an 8% operational growth in revenue and a 13% operational growth in adjusted net income.The company expects double-digit operational growth in the companion animal portfolio and low single-digit operational growth in the livestock portfolio.

Zoetis Inc.: How This Leader in Animal Health is Outpacing Global Challenges! - Major Drivers

<ul><li>Zoetis Inc. managed to surpass the revenue and earnings expectations of Wall Street.</li><li>Based on the wide portfolio across markets and species, Zoetis delivered solid second-quarter results of 9% operational growth in revenue and 12% in adjusted net income.</li><li>The company reverted to more balanced sector growth this quarter, with 11% operational growth worldwide and 7% in the United States.</li></ul>

Zoetis Inc. managed to surpass the revenue and earnings expectations of Wall Street.Based on the wide portfolio across markets and species, Zoetis delivered solid second-quarter results of 9% operational growth in revenue and 12% in adjusted net income.The company reverted to more balanced sector growth this quarter, with 11% operational growth worldwide and 7% in the United States.

Zoetis Inc.: The Vetscan Mastigram+ Launch - A Game Changer in European Markets! - Major Drivers

Global Healthcare Analyst

Tina Banerjee

Thematic (Sector/Industry)

<ul>
<li>We are recommending to go long on <a href="https://www.smartkarma.com/entities/gland-pharma-ltd" target="_blank" data-smartkarma-citation="entities:29723:1" rel="noopener">Gland Pharma Ltd (GLAND IN)</a> and short on <a href="https://www.smartkarma.com/entities/syngene-international-ltd" target="_blank" data-smartkarma-citation="entities:26923:1" rel="noopener">Syngene International Ltd (SYNG IN)</a>. </li>
<li>Gland Pharma, with its niche focus on generic injectables is expected to be outlier, while Syngene, with substantial exposure to early-stage biotech research will continue to have muted performance.</li>
<li>Over the last six months, Gland Pharma shares rallied 83%, while Syngene International shares declined 5%. We expect the performance gap between the two companies will widen further.</li>
</ul>


We are recommending to go long on Gland Pharma Ltd (GLAND IN) and short on Syngene International Ltd (SYNG IN). 
Gland Pharma, with its niche focus on generic injectables is expected to be outlier, while Syngene, with substantial exposure to early-stage biotech research will continue to have muted performance.
Over the last six months, Gland Pharma shares rallied 83%, while Syngene International shares declined 5%. We expect the performance gap between the two companies will widen further.


Indian Contract Manufacturers: A Pair Trade Idea Between Gland Pharma and Syngene International

<ul><li>Zoetis delivered a mixed set of results for the previous quarter with revenues well below analyst expectations but managed an earnings beat.</li><li>While revenues from companion animal products were flat operationally, their livestock portfolio led to the results with a 12% operational gain in revenue.</li><li>Zoetis’ team anticipates flat operational growth in its cattle portfolio and double-digit operational growth for its cutting-edge companion animal portfolio.</li></ul>

Zoetis delivered a mixed set of results for the previous quarter with revenues well below analyst expectations but managed an earnings beat.While revenues from companion animal products were flat operationally, their livestock portfolio led to the results with a 12% operational gain in revenue.Zoetis’ team anticipates flat operational growth in its cattle portfolio and double-digit operational growth for its cutting-edge companion animal portfolio.

Zoetis Inc.: International Business Leads Growth

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>At the end of PUSU deadline, EQT and Dechra have agreed a 3,875p/share offer (44% premium, 21.4x EV/Fwd EBITDA, 30.2x Fwd P/E, vs. market leader Zoetis at 20.5x and 28.9x respectively).</li>
<li>Other private equity companies may not be able to match the deal's disintermediation benefits. Considering the short-term issues, I believe investors will accept the offer.</li>
<li>My base-case DCF fair-value estimate is 3,568p/share, 7.9% below the offer price. Therefore I set my <strong>TP</strong> at <strong>3,875p.</strong> Spread is 5.8%/8.8% (gross/annualised), I feel the risk/reward is balanced. Long.</li>
</ul>


At the end of PUSU deadline, EQT and Dechra have agreed a 3,875p/share offer (44% premium, 21.4x EV/Fwd EBITDA, 30.2x Fwd P/E, vs. market leader Zoetis at 20.5x and 28.9x respectively).
Other private equity companies may not be able to match the deal's disintermediation benefits. Considering the short-term issues, I believe investors will accept the offer.
My base-case DCF fair-value estimate is 3,568p/share, 7.9% below the offer price. Therefore I set my TP at 3,875p. Spread is 5.8%/8.8% (gross/annualised), I feel the risk/reward is balanced. Long.


EQT/​Dechra Pharmaceuticals: Recommended Offer

United States

Zoetis Inc discovers, develops, manufactures and commercializes animal health medicines and vaccines, with a focus on both livestock and companion animals.  The Companies products are sold in North America, Europe, Africa, Asia, Australia and Latin America.

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Zoetis Inc (ZTS US)

Zoetis Inc.: How This Leader in Animal Health is Outpacing Global Challenges! - Major Drivers

Zoetis Inc.'s results were a major disappointment as it failed to meet Wall Street's revenue and earnings expectations. Despite ongoing challenges...

Baptista Research

Zoetis Inc.: The Vetscan Mastigram+ Launch - A Game Changer in European Markets! - Major Drivers

Zoetis Inc. managed to surpass the revenue and earnings expectations of Wall Street. Based on the wide portfolio across markets and species,...

Baptista Research

Indian Contract Manufacturers: A Pair Trade Idea Between Gland Pharma and Syngene International

Gland Pharma, with its niche focus on generic injectables is expected to be outlier, while Syngene, with substantial exposure to early-stage...

Tina Banerjee

Zoetis Inc.: International Business Leads Growth

Zoetis delivered a mixed set of results for the previous quarter with revenues well below analyst expectations but managed an earnings beat. While...

Baptista Research

EQT/Dechra Pharmaceuticals: Recommended Offer

In spite of negative trading updated, EQT has followed in its pursuit of Dechra and today both have agreed a fair, in my view, 3,875p/share offer...

Jesus Rodriguez Aguilar

Price Gauge

52-week Range

Market Cap (USDm)

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Zoetis Inc.: How This Leader in Animal Health is Outpacing Global Challenges! - Major Drivers

Zoetis Inc.'s results were a major disappointment as it failed to meet Wall Street's revenue and earnings expectations. Despite ongoing challenges...

Baptista Research

Zoetis Inc.: The Vetscan Mastigram+ Launch - A Game Changer in European Markets! - Major Drivers

Zoetis Inc. managed to surpass the revenue and earnings expectations of Wall Street. Based on the wide portfolio across markets and species,...

Baptista Research

Indian Contract Manufacturers: A Pair Trade Idea Between Gland Pharma and Syngene International

Gland Pharma, with its niche focus on generic injectables is expected to be outlier, while Syngene, with substantial exposure to early-stage...

Tina Banerjee

Zoetis Inc.: International Business Leads Growth

Zoetis delivered a mixed set of results for the previous quarter with revenues well below analyst expectations but managed an earnings beat. While...

Baptista Research

EQT/​Dechra Pharmaceuticals: Recommended Offer

In spite of negative trading updated, EQT has followed in its pursuit of Dechra and today both have agreed a fair, in my view, 3,875p/share offer...

Jesus Rodriguez Aguilar

EQT/Dechra Pharmaceuticals: Recommended Offer