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Image source: Getty Images <\/p>\n Image source: Getty Images <\/p>\n
AstraZeneca (LSE: AZN) shares wobbled a bit Wednesday morning (29 April), even though the pharma giant reported more than $15bn in first-quarter revenue. The results beat expectations, and the company reaffirmed its positive full-year guidance.<\/p>\n
CEO Pascal Soriot told us the company is \u201con track to achieve our ambition for 2030 and beyond.\u201d<\/p>\n
The share price dipped a couple of percent, edging into negative territory year to date. But AstraZeneca is still up 19% over 12 months \u2014 and has soared 85% in the past five years. Let\u2019s dig in and see what\u2019s happening\u2026<\/p>\n
Double-digit growth <\/p>\n
The company reported a 5% rise in core earnings per share. And the board says it expects mid-to-high single-digit revenue growth and low double-digit core EPS growth for the full year.<\/p>\n
It\u2019s hard to think of a better example of how a long-term plan can outstrip short-term earnings targets than AstraZeneca. And it\u2019s all thanks to the stunning turnaround Pascal Soriot kicked off when he took on the challenge in 2012. AstraZeneca needed to focus on getting its research pipeline up to strength. And the new boss made it clear it would need time and patience.<\/p>\n
As an aside, an investor who put \u00a35,000 into AstraZeneca on the day Soriot became boss would today be sitting on shares worth \u00a323,550, by my calculation.<\/p>\n
What\u2019s next? <\/p>\n
Looking at these results, I\u2019m struck by one part of what the CEO said.<\/p>\n
We are advancing through our catalyst\u2011rich period, with positive readouts for four high-value Phase III programmes since our last quarterly results, including first pivotal data for two key NMEs \u2013 tozorakimab in COPD and efzimfotase alfa in hypophosphatasia.<\/p>\n
Expertise in oncology and rare diseases lies behind AstraZeneca\u2019s success. And these new developments, with the boss talking about multiple launches in preparation, convince me the company still has its eye on the ball \u2014 and its sights set on long-term growth.<\/p>\n
There\u2019s a strategic collaboration with CSPC Pharmaceuticals too, \u201cto advance the development of multiple next-generation therapies for obesity and type 2 diabetes.\u201d AstraZeneca will invest $1.2bn upfront.<\/p>\n
Potential pitfalls <\/p>\n
An aggressive drug research pipeline is, however, in part a case of running to stand still. We\u2019ll see the expiry of some profitable patents in the coming years, including a handful of blockbusters.<\/p>\n
And even an impressive pipeline like AstraZeneca\u2019s is no guarantee that lost blockbuster profits will be replaced. It\u2019s a problem that faces all pharmaceutical companies.<\/p>\n
Whether the stock\u2019s high valuation is fair is a tricky question. We\u2019re looking at a forward price-to-earnings (P\/E) ratio of close to 24 for the current year. And this is a company with only modest dividend yields \u2014 there\u2019s 1.7% forecast for this year.<\/p>\n
So what\u2019s the verdict? <\/p>\n
The weak reaction to this latest quarter doesn\u2019t surprise me that much, as a company can need to smash expectations to impress growth investors at these levels. And this was largely as expected.<\/p>\n
But I think AstraZeneca deserves its premium rating, and I reckon long-term ISA investors should consider it.<\/p>\n
The post What next for AstraZeneca shares, after another cracking quarter?<\/a> appeared first on The Motley Fool UK<\/a>.<\/p>\n More reading<\/p>\n Alan Oscroft<\/a> has no position in any of the shares mentioned. The Motley Fool UK has recommended AstraZeneca Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.<\/a><\/p>\n Motley Fool UK 2026<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images AstraZeneca (LSE: AZN) shares wobbled a bit Wednesday morning (29 April), even though the…\n","protected":false},"author":2,"featured_media":12098,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[20662],"tags":[11153,7920,11316,21186,1854],"class_list":["post-42007","post","type-post","status-publish","format-standard","has-post-thumbnail","category-astrazeneca","tag-astrazeneca","tag-earnings-per-share","tag-pascal-soriot","tag-research-pipeline","tag-revenue-growth"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@UnitedKingdom\/116607831878605406","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/42007","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/comments?post=42007"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/42007\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media\/12098"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media?parent=42007"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/categories?post=42007"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/tags?post=42007"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}