AstraZeneca Earnings: Solid Results, but Approaching Generic Pressure Will Likely Slow Growth

We are holding steady to our GBX 12,400/$78 fair value estimates (local/ADR) for AstraZeneca following second-quarter results that were largely in line with our expectations. However, the higher operating expenses in the quarter are likely weighing on shares, as the market was potentially expecting better operating margins. We expect margin improvement over the next three years as the firm leverages several recent product launches.