Citi Raises Endo Pharmaceuticals Estimates

Citi is raising its estimates on Endo Pharmaceuticals Holdings Inc. ENDP on the following elements: “1) An earlier acquisition close,” Citi writes. “2) A lower blended rate on debt (4.4% vs. prior 5.0% est.); 3) $400M retirement in existing Term A loans (TLA); 4) $170M smaller use of cash on hand; offset by 5) higher acquisition-related debt ($3.1B vs. $2.6B est.) & $10M lower '11 sales (due to AMS voluntary recall of its artificial urinary sphincter). “Our projected annual AMS sales growth is below AMS's projected 10%-12% (disclosed in its 6/2/11 proxy). Our blended interest rate of 4.4% includes: $500M in 7% notes due'19, $400M in 7.25% notes due'22, $1.5B in TLA (4% est.) & $700M in TLB (3% est.).” Endo Pharmaceuticals closed Friday at $39.14.