Generic drug trends could drive drugmaker's shares

ANI Pharmaceuticals Inc. makes generic and brand-name pharmaceuticals at two facilities in Baudette, Minn. One location specializes in making and packaging oral solid dose and liquid drugs, and the other specializes in making and packaging hormone drugs.

The company is covered by three firms and probably doesn't get a lot of analyst visits to the northern Minnesota border town, but president and CEO Art Przybyl will go on the road. Analysts for Oppenheimer & Co. recently hosted ANI's management, including Przybyl, to discuss the company's business development activity and updates on development of new drugs.

ANI has a strong balance sheet with about $170 million in cash on hand to develop new drugs internally or acquire additional generic drug lines. One of its key estrogen drugs is also a candidate for price increases that would follow on the price increase of its brand name equivalent made by another company.

Oppenheimer analyst Rohit Vanjani has one of the two "buy" recommendations on ANI Pharmaceuticals and increased his 12-month price target after Przybyl's recent visit from $61 per share to $67. Shares were trading around $63.60 last week. "We are slightly increasing our price target on shares of ANI based on added confidence in the pipeline as well as the potential for further price increases," wrote Vanjani.

Patrick Kennedy

Polaris' Slingshot flies past sales projections

Polaris Industries Inc. introduced the Slingshot last July. Sales of the reverse three-wheel trike in its initial year have exceeded expectations.

Wedbush Securities analyst James Hardiman wrote earlier this month that because of insatiable demand for the three-wheel vehicle, he has increased his estimate on the number of Slingshot units to be sold this year from 5,300 to 9,000. That would translate to an additional $74 million in revenue for Medina-based Polaris.

Hardiman wrote that dealers are selling units as fast as they come in and that Polaris is expanding the states where they can be sold as local governments craft new bills to accommodate the vehicles.

The news is not all positive.

"It is worth noting that given its newness, the Slingshot likely carries the lowest gross margin of any of Polaris' product lines," Hardiman wrote. "As a result, we do believe that the outperformance of Slingshot will have somewhat of a negative impact on gross margin, but that the overall earnings contribution from this faster-than-expected ramp will be a positive one."

Patrick Kennedy