Viatris: Get Paid 5%, Before Growth Materializes

Summary

• VTRS lost its Humira biosimilar through the divestiture of its biosimilar segment to Biocon, with the former similarly losing another growth prospects in Wegovy.
• These headwinds suggest that VTRS may unfortunately miss the future gravy train for the best-selling drugs in the world, naturally hampering its top-line expansions.
• For now, its top five revenue drivers have also been declining over time to $938M in the latest quarter (-3.8% QoQ/ -4.8% YoY), further validating its discounted valuations.
• While VTRS remains profitable and continues to optimize costs, it remains to be seen when the stock may recover, with its reversal likely to take longer than a few years.
• While we may rate the stock as a Buy here, thanks to its tempting dividends, investors must also size the portfolios accordingly, since its ongoing divestitures may result in impacted bottom line and dividend cash flow.

We Are

The VTRS Investment Thesis Remains Decent For Dividend Hunters

We previously covered Viatris Inc. (NASDAQ:VTRS) in March 2022, discussing its uncertain prospects as the company delivered an underwhelming FQ4'21 revenues then.

At that point, part of the pessimism

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The analysis is provided exclusively for informational purposes and should not be considered professional investment advice. Before investing, please conduct personal in-depth research and utmost due diligence, as there are many risks associated with the trade, including capital loss.