With a market cap of $10.7 billion, Catalent, Inc. (CTLT) stands as a prominent global provider of advanced delivery technologies and development solutions for drugs, biologics, and consumer health products. The Somerset, New Jersey-based company operates in two key segments: Biologics and Pharma & Consumer Health.
Impressive Stock Performance Against Indexes
Over the past 52 weeks, shares of Catalent have outperformed the broader market. CTLT stock has risen 47.8%, surpassing the S&P 500 Index’s ($SPX) 30.1% increase during the same period. In 2024, CTLT shares are up 31.3%, while the SPX has gained 24.1% year-to-date (YTD).
Comprehensive Comparison to Health Sector
CTLT also exceeded the Health Care Select Sector SPDR Fund’s (XLV) 10.2% returns over the last year and outperformed its YTD rise of 4.9%.
Short-Term Challenges and Analyst Concerns
On November 5, shares of Catalent dipped slightly following the announcement of a weaker-than-expected Q1, reporting an adjusted loss of $0.13 per share alongside revenue of $1 billion. The Biologics segment lagged, bringing in only $461 million—below expectations. Additionally, doubts surrounding regulatory approval for Catalent’s acquisition by Novo Holdings and concerns from consumer and labor groups regarding potential competition risks in the weight-loss drug sector raised further alarms among investors.
Future Earnings Projections and Analyst Ratings
For the fiscal year ending in June 2025, analysts anticipate significant year-over-year growth in CTLT’s earnings per share (EPS) to reach $0.84. Historical earnings surprise data reveals a mixed record for the company, having met or exceeded consensus estimates only once in the last four quarters while missing on three occasions.
Currently, nine analysts are monitoring the stock, with a general consensus rating of “Hold.” This includes one “Strong Buy” rating and eight “Holds,” reflecting a slightly less optimistic view compared to three months ago, when the stock had two “Strong Buy” ratings.
Jefferies Analyst Maintains Cautious Stance
On November 6, Jefferies analyst David Windley upheld a “Hold” rating on Catalent, assigning a price target of $63.50. He cited underperformance in the Biologics segment as a significant concern. Although the Pharma and Consumer Health segment remains stable, the recent sale of the Somerset, NJ facility and ongoing challenges in the Biologics division contribute to a cautious outlook for the company.
Currently, CTLT trades below the average price target of $63.42. The highest price target of $63.50 suggests modest upside potential of just 7.6%.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
