Down Recordati, Jefferies sees reduction in margins in 2026

(Il Sole 24 Ore Radiocor) - Recordati slides among the worst stocks in the FTSE MIB , down more than a percentage point, with analysts at Jefferies limiting their target price from EUR61.5 to EUR60.5 on forecasts of a reduction in margins in 2026. Under the analysts' lens is Recordati's rare disease strategy, particularly its Isturisa and Enjaymo drugs, which are expected to 'drive significant growth'.

The experts' assessment is 'partially positive', with management raising its estimate of Isturisa's maximum turnover from EUR 550-650 million to over EUR 1.2 billion, 'reflecting the expected contribution from the potentially larger population with non-manifest Cushing's syndrome'. This 'significant upgrade', Jefferies explains, is supported by an 'investment of EUR 40-50 million per year'. Analysts 'believe in the opportunity', but prefer to be cautious as they wait for 'sustained quarterly momentum' to confirm the massive expansion of the patient pool (from 7,000 to around 30,000 patients in the US) announced by the company.

Therefore, they raise the 'maximum sales forecast for Isturisa to around EUR 850 million', below Recordati's estimate. They also see some 'short-term pressure on margins to support the unlocking of the potential' of the drug, 'due to unfavourable exchange rate trends and higher investments in Isturisa'. Thus, although sales for rare diseases may accelerate from around 15% this year to 19% next year', margins are expected to fall to 36%, before returning to around 38% in 2027.

For the current year, Jefferies then lowered its forecasts for Ebitda and sales to the low end of the consensus, given several factors such as "weaker growth in Italy" and a weaker price trend in Turkey compared to previous years. In any case, the experts explained, "Mergers and acquisitions remain essential to achieve Recordati's goal of doubling revenues by 2030" and will require expenditure of "€550 million per year over the next five years".