Recently, several CXO head companies have predicted the performance in 2021 and achieved rapid growth, but it seems that this can not bring the stabilization and rebound of stock price
On January 18, Wuxi Apptec Co.Ltd(603259) (603259. SH) released the annual performance forecast for 2021. It is expected to achieve a revenue of 22.82-22.9 billion yuan in 2021, a year-on-year increase of 38% - 38.5%; The net profit attributable to the parent company was RMB 4.97-5.03 billion, with a year-on-year increase of 68% - 70%; The net profit attributable to the parent company after deduction was RMB 4.01-4.05 billion, with a year-on-year increase of 68-70%.
It is worth noting that the consistent forecast value of Wuxi Apptec Co.Ltd(603259) 2021 net profit of 28 institutions recently is 4.472 billion yuan. This means that the performance guidance given by the company, even the lower limit, is also above the predicted value of the organization. However, the company's share price fell for three consecutive days.
Coincidentally, the performance forecasts recently released by CXO company Shanghai Medicilon Inc(688202) (688202. SH), Hangzhou Tigermed Consulting Co.Ltd(300347) (300347. SZ), Porton Pharma Solutions Ltd(300363) (300363. SZ), Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) (603456. SH), Joinn Laboratories (China) Co.Ltd(603127) (603127. SH) are also "gratifying", but the stock price trend is difficult to satisfy investors.
Figure | forecast of CXO's 2021 annual report, source: Science and Innovation Board daily
CXO track ups and downs in 2021
The resumption of CXO market in 2021 can be basically divided into four stages——
At the beginning of 2021, under the expectation of accelerated performance, the CXO industry showed a good upward trend, and the valuation increased accordingly.
However, after the Spring Festival, the pharmaceutical sector as a whole fluctuated downward, and the CXO sector with high overvalued value in the early stage had the most callback.
In the mid-term report quarter of 2021, the high performance expectation of the mid-term report will once again raise the market's attention to CXO. However, on July 2, 2021, the CDE of the National Drug Evaluation Center issued the draft for comments on the guiding principles for clinical research and development of antitumor drugs guided by clinical value, which raised doubts about the outlook of CXO in the market, resulting in slight fluctuations in the overall sector.
In the second half of 2021, the capital style switched, the pharmaceutical sector entered the adjustment period, and the overvalued CXO sector retreated greatly. At the same time, the investment and financing data of the primary market fell quarter on quarter, superimposing the breaking of many listed pharmaceutical enterprises in the second half of the year, causing the market to worry about the demand for CXO outsourcing.
why is the performance up and the share price down?
At the close from January 18 to 21, the CXO sector fell more than 10%. On the 18th, Wuxi Apptec Co.Ltd(603259) and Shanghai Medicilon Inc(688202) closed down 4.92% and 2.42% respectively; 19 Zhejiang Jiuzhou Pharmaceutical Co.Ltd(603456) closed down 8.27%; On the 20th Joinn Laboratories (China) Co.Ltd(603127) closed down 1.88%.
The market view generally believes that the main factor for the weakening of the sector is the bad market sentiment, "core assets are falling".
Some investors told the reporter of science and Innovation Board daily that CXO is essentially an innovative drug ETF, but the innovative drug industry has been hit repeatedly recently.
Catalysed by a series of favorable policies, Chinese innovative drug enterprises have flourished after 2015. However, the new policy of "clinical value oriented new drug research and development" issued by the State Food and Drug Administration in July 2021 seems to have dropped a deep-water bomb.
The above policies are considered by the market to increase the difficulty of clinical trials and listing costs of new drugs, thus triggering a sharp decline in the innovative drug sector.
At the same time, on the medical insurance payment side, the adjustment of the medical insurance catalogue is fixed once a year. From the medical insurance negotiation results in the past two years, the medical insurance payment price of innovative drugs is constantly falling.
The listing cost should be increased, but the commercialization income after listing is diluted, which means that the R & D of innovative drugs is no longer "lying win". This change in investment logic and expectation can be said to be another big impact on market confidence.
In the secondary market, in sharp contrast to the weakness of the leading companies, CXO's share price on the covid-19 pharmaceutical industry chain has performed eye-catching recently.
On November 2, 2021, Xinxiang Tuoxin Pharmaceutical Co.Ltd(301089) (301089. SZ) said on the interactive platform that the company's product uridine is the raw material for the production of eidd-2801, which is the raw material for the production of molnupiravir, an oral drug of melsadon covid-19. The company's share price has been rising continuously since November 5, 2021, with a daily limit of 20%. As of the closing on January 20, 2022, the share price has increased by more than 330%.
In the past three months, Aba Chemicals Corporation(300261) (300261. SZ) with the same concept has soared by more than 420%; Senxuan medicine (830946. BJ) repeatedly raised the 30cm limit, up 450%.
how can I go in the future?
Some fund managers believe in the four seasons that the long-term growth and leading advantages of these companies in the industry have not changed, but the excessive valuation takes some time to resolve. For the vast majority of them, this year is a year to digest the valuation.
In fact, although CXO's 2021 is not a good year, under the background of the overall downturn of the pharmaceutical industry, the high outlook of the industry makes CXO a relatively good track.
In 2021, there are still new star fund managers crowned through the revenue of CXO track. The Damo health industry managed by Wang Dapeng has become one of the few pharmaceutical funds with annual revenue exceeding 20% in 2021. After dismantling the income composition of Damo health industry, it is found that the fund's income in stock selection ability is particularly prominent during the shock period, and a large part of the stock selection income comes from CXO segment.
Some fund managers also pointed out to the reporters of the science and Innovation Board daily that under the background of continuous pressure on the policy, the pharmaceutical investment in 2022 will become more challenging, and it is necessary to obtain income through top-down stock selection, "rather than easily win if you choose the right track".
