Baird analyst Evan Stover noted that a short report published this morning “mainly highlights” Catalent’s weak free cash flow and some associated changes in balance sheet accounts, telling investors that on “first blush” he didn’t see “anything here that is completely new.” Management has been transparent in recent quarters about the drivers behind growing contract assets and declining contract liabilities and though things have changed due to the COVID vaccines “that doesn’t necessarily mean nefarious motives,” according to Stover, who thinks elements of this short thesis were already a factor behind the selloff following the company’s early November update. Stover keeps an Outperform rating and $75 price target on Catalent shares, which are down $2.07, or 4%, to $45.15 in afternoon trading.
Published first on TheFly
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