Grifols Downgraded to Equal-Weight, Price Target Cut to €11 on Growth Uncertainty
Grifols’ shares fell after Morgan Stanley cut its rating to Equal-weight and lowered its price target to €11 from €14, citing uncertain medium-term revenue growth and headwinds in albumin and alpha-1 segments. The firm forecasts 3% constant-currency revenue growth and €1.93 billion adjusted EBITDA for 2026.
1. Morgan Stanley Downgrade
Grifols shares dropped 1.6% in U.S. premarket after Morgan Stanley cut its rating to Equal-weight from Overweight and lowered its price target to €11 from €14, citing reduced visibility on medium-term revenue growth.
2. Revised 2026 Forecasts
Analysts now forecast constant-currency revenue growth of around 3% for 2026 and adjusted EBITDA of €1.93 billion, representing roughly 8% growth; they also project free cash flow of €500–€575 million driven by margin expansion.
3. Segment Headwinds
Pressure in the albumin business in China persists due to hospital reimbursement restrictions, and alpha-1 protein outlook remains uncertain; management plans a voluntary slowdown in immunoglobulin volume growth to protect margins and reallocate supply to higher-value markets.
4. Valuation and Competitive Risks
Grifols trades at approximately nine times next-12-month EV/EBITDA, but potential filing of Sanofi’s recombinant alpha-1 therapy poses a key competitive risk that could weigh on future growth prospects.