Piper Jaffray Reiterates Overweight and PT of $72 on Watson Pharmaceuticals

Piper Jaffray reiterated its Overweight rating on Watson Pharmaceuticals WPI. At the same time, Piper Jaffray left its price target unchanged at $72. In a research report published today, Piper cited the company's strong performance in the generic drugs market as the reason for its decision. In the report, Piper states, "Watson's Concerta authorized generic (AG), which launched on May 1, is off to a strong start, with the AG already accounting for 42.5% of the Concerta prescription (Rx) market. We continue to believe that long-term generic exclusivity on Concerta is realistic, potentially through the expiry of the AG agreement in 2014. With strong visibility on double digit EPS growth for at least the next 2-3 years, and a P/E of only 11x our 2012 EPS estimate of $5.69, we believe WPI shares are valued attractively. We reiterate our Overweight rating and $72 PT." On Monday, Watson closed the day at $61.86.