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Currency in USD
Last close As at 02/06/2023
USD5.48
▲ −0.13 (−2.32%)
Market capitalisation
USD391m
Research: Healthcare
SIGA Technologies (SIGA) has announced receipt of $16m of international procurement orders in the European Union (EU) and the Asia-Pacific region (APAC) for oral TPOXX (tecovirimat) for short-term stockpiling and/or deployment against the monkeypox outbreak. To date in 2022, SIGA has received about $76m in international orders for oral TPOXX from 12 customers, and about $65m of those orders are expected to be delivered in 2022. The contract wins are evidence of SIGA’s continued penetration into the EU and APAC. We expect continued strong momentum for the company as demand for therapeutics such as TPOXX intensifies as countries focus on addressing the monkeypox outbreak. We maintain our valuation of $19.80 per SIGA share.
SIGA Technologies |
Monkeypox concern drives international TPOXX win |
Procurement orders |
Pharma and biotech |
27 September 2022 |
Share price performance
Business description
Analysts
SIGA Technologies is a research client of Edison Investment Research Limited |
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SIGA Technologies (SIGA) has announced receipt of $16m of international procurement orders in the European Union (EU) and the Asia-Pacific region (APAC) for oral TPOXX (tecovirimat) for short-term stockpiling and/or deployment against the monkeypox outbreak. To date in 2022, SIGA has received about $76m in international orders for oral TPOXX from 12 customers, and about $65m of those orders are expected to be delivered in 2022. The contract wins are evidence of SIGA’s continued penetration into the EU and APAC. We expect continued strong momentum for the company as demand for therapeutics such as TPOXX intensifies as countries focus on addressing the monkeypox outbreak. We maintain our valuation of $19.80 per SIGA share.
Year end |
Revenue (US$m) |
EBITDA* |
PBT* |
EPS* |
P/E |
Net cash |
12/20 |
125.0 |
88.6 |
81.5 |
0.81 |
12.9 |
117.9 |
12/21 |
133.7 |
89.7 |
89.1 |
0.91 |
11.5 |
103.1 |
12/22e |
125.0 |
63.5 |
63.0 |
0.66 |
15.8 |
71.8 |
12/23e |
128.1 |
65.6 |
65.1 |
0.72 |
14.5 |
94.2 |
Note: *EBITDA, PBT and EPS (diluted) are normalized, excluding amortization of acquired intangibles, exceptional items and share-based payments.
SIGA reported the receipt of $16m of international procurement orders for oral TPOXX in August and early September, including $10m from the European Commission (EC) and $6m from two countries in APAC. The EC order was for emergency short-term stockpiling and/or deployment of oral TPOXX in connection with the monkeypox outbreak. As background, the EC can secure TPOXX in two ways: through direct purchases and through a joint procurement program in coordination with country-level procurement. The APAC orders are from an existing customer and a new customer, marking further expansion into this geographic region. Management expects to complete delivery of both these orders in 2022.
FY22 has been a catalyst-rich year for SIGA as these orders follow multiple other contract wins in North America, European countries and APAC. To date in 2022, SIGA has received $76m in international orders for oral TPOXX across 12 customers. Several European governmental customers have announced strategies to procure combination medicines (vaccines and treatments) to control monkeypox. We believe these moves fuelled the recent procurement orders for SIGA’s TPOXX (see our previous report for more details).
With about 64k global cases and 23k cases in the United States, monkeypox is a growing concern for governments and health agencies. Antivirals are the first line in easing monkeypox symptoms. SIGA’s antiviral product tecovirimat (TPOXX) is the leading therapeutic, originally designed to treat smallpox. Currently, it is the only allowed therapy for all orthopoxvirus pathogens, including monkeypox, approved in both the UK (July 2022) and the EU (January 2022).
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Research: Industrials
Cohort’s trading update ahead of its AGM and capital markets day continues to indicate the FY23 trading performance is ahead of the prior year. A continued strong level of order intake supported by UK MOD activity appears to be mitigating some ongoing supply chain delays, mainly affecting EID in Portugal. Our group FY23 estimates remain unchanged. For FY24 we now assume a lower tax rate which lifts our EPS estimate by c 7%. The resulting FY24 P/E of 12.6x looks increasingly undemanding with the lower UK tax assumption boosting our DCF value to 726p per share (from 684p previously).
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