AstraZeneca strengthens global operations despite China challenges
The pharmaceutical giant announces leadership changes and major US investment while addressing compliance issues in China.
AstraZeneca strengthens global operations despite China challenges
AstraZeneca is implementing significant strategic changes across its global operations, balancing challenges in China with expansion plans in the United States.
Leadership changes and China operations
The appointment of Iskra Reic as head of China operations follows the detention of former leader Leon Wang amid broader healthcare sector scrutiny.
CEO Sir Pascal Soriot has addressed compliance issues involving WeChat usage by employees, leading to enhanced control measures.
These developments come at a crucial time for AstraZeneca's Chinese operations, though the company maintains its commitment to this key market.
The pharmaceutical giant's swift response demonstrates its ability to navigate complex regulatory environments.
US expansion plans
AstraZeneca has announced a substantial $3.5 billion investment in US operations through 2026.
This investment aims to create over 1,000 high-skilled jobs across its American facilities.
The expansion reflects the company's confidence in the US market and its growth strategy.
This move could help reduce dependency on any single market while strengthening its global presence.
Financial performance
Strong demand for cancer and rare-disease treatments has driven better-than-expected third-quarter (Q3) results.
The company has raised its full-year sales outlook based on this performance.
Share trading activity suggests investors are responding positively to these developments.
The financial outlook remains robust despite operational challenges in some markets.
Board refreshment
The appointment of René Haas (Arm Holdings CEO) and Birgit Conix (Sonova CFO) as non-executive directors strengthens corporate governance.
These appointments bring additional technology and financial expertise to the board.
The timing aligns with AstraZeneca's broader strategic refresh and expansion plans.
These changes suggest a focus on enhancing digital capabilities and financial oversight.
AstraZeneca analyst ratings
TipRanks gives AstraZeneca a Smart Score of 10, outperform, with 9 ‘buy’ and 5 ‘hold’ analyst recommendations.
TipRanks Smart Score
According to LSEG Data & Analytics, 7 analysts rate AstraZeneca as a ‘strong buy’, 11 as a ‘buy’, 8 as a ‘hold’ with a mean price target at 13,161 pence, 26% above current levels (as of 17/12/2024).
AstraZeneca analyst ratings
AstraZeneca share price technical analysis
The AstraZeneca share price dropped by 25% from its September peak to its November low at 9,670 pence before regaining lost ground over the past few weeks.
It hasn’t come as a surprise to technical analysts that the AstraZeneca share price found support where it did since the November trough was made in a key long-term technical support zone. It consists of the May 2022-to-February 2024 lows and makes up significant support between 9,778p and 9,399p.
As long as this support area underpins on a weekly chart closing basis, the AstraZeneca share price is deemed to be in a wide, multi-year sideways trading range with a longer-term bullish bias.
AstraZeneca share price monthly chart
The 200-week simple moving average (SMA) at 10,272p, together with the psychological 10,000 mark, may act as potential support regions in case of another setback being witnessed.
For the bulls to regain control, a rise and weekly chart close above the early December high at 10,804p would need to ensue. If so, the July-to-October 2023 highs at 11,264p-to-11,304p would be in focus, together with the 55-week SMA at 11,340p.
AstraZeneca share price weekly chart
A rise above the 55-week SMA at 11,340p may lead to the April 2023 high at 12,392p being back in the frame in the course of next year.
How to trade AstraZeneca shares
- Research the pharmaceutical sector and AstraZeneca's market position
- Consider whether to buy shares or trade derivatives
- Open an account with us
- Monitor company developments and sector trends
- Implement appropriate risk management strategies
AstraZeneca's balanced approach to addressing challenges while pursuing growth opportunities suggests continued resilience in its business model, though investors should monitor developments in key markets, particularly China.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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