Syneos Health Target Price Raised Amid $7.1B Acquisition News: Analyst Provides Insight

Mizuho analyst Ann Hynes reiterated a Neutral rating on the shares of Syneos Health, Inc. SYNH, raising the price target to $43 from $38.
The company recently announced a definitive agreement to be purchased by a group of private equity firms led by Elliott Investment Management for $7.1 billion, including the assumption of all debt. The price target has been raised, focusing on the pending acquisition deal.
Also Read: Syneos To Be Acquired By Private Investment Consortium For $7.1B, Q1 Earnings Beat Expectations
Completion of the transaction is expected in the second half of 2023.
Hynes thinks this deal represents a purchase multiple of ~10.1x 2023 adjusted EBITDA, below historical CRO (Contract Research Organization) deals.
The purchase multiple is below the CRO industry's ten, five and two-year historical EV/EBITDA trading averages of 13.4x, 15.5x and 16.5x, respectively.
The analyst reiterated FY23 adjusted EPS estimate at $3.30.
However, considering challenged operational results in the just-reported first quarter of FY23, the analyst lowered 2024 estimates by $0.50 to $3.75.
Price Action: SYNH is trading lower by 0.38% to $41.56 in the market session on the last check Tuesday.