Analysts have lowered their price target for Perrigo from $33.50 to $32.50. They cite modestly slower projected revenue growth, although profit margins and discount rate assumptions remain stable.

Analyst Commentary

Following the revised outlook for Perrigo, analysts have shared insights concerning the drivers behind the updated price target. Their assessments reflect both optimism about certain fundamentals and caution regarding areas of potential risk.

Bullish Takeaways

• Bullish analysts highlight that profit margins are expected to remain steady. This supports Perrigo's ability to maintain profitability even with slower revenue growth.
• Stable discount rate assumptions are viewed as a positive, which indicates that the broader market has confidence in Perrigo's risk profile.
• The underlying fundamentals and operational efficiencies are seen as providing a solid base for future performance if revenue can accelerate.

Bearish Takeaways

• Bearish analysts note concerns over the modest slowdown in projected revenue growth, which was a primary driver for the lower price target.
• Execution risk remains, particularly if the revenue trajectory does not improve in the coming quarters.
• There is caution that stable profit margins alone may not offset the impact of softer top-line expansion on valuation multiples.

What's in the News

• Perrigo launches a partnership with "Opill and Chillhouse," making non-prescription Opill birth control and self-care products more widely accessible and donating Opill packs to the NY Birth Control Access Project for every Chillhouse product sold (Client Announcements).
• Teamsters Local 210 employees at Perrigo's Bronx facility are on strike after the company sought to eliminate overtime protections and retirement contributions. Bargaining is set to resume September 17, and picketing is ongoing daily (Labor-related Announcements).
• Perrigo reaffirmed its fiscal year 2025 earnings guidance, projecting EPS of $2.90 to $3.10 per share with strong growth in operating income and EPS. Net sales are trending toward the lower end of the expected range (Corporate Guidance).

Valuation Changes

• Consensus Analyst Price Target has decreased from $33.50 to $32.50. This reflects a modest adjustment in valuation.
• Discount Rate has edged up marginally, rising from 7.97% to approximately 7.98%.
• Revenue Growth expectations have fallen slightly from 1.74% to 1.60%.
• Net Profit Margin has improved modestly, increasing from 4.03% to 4.05%.
• Future P/E has declined from 32.38x to 31.42x. This indicates a lower valuation multiple on forward earnings.