# AstraZeneca (AZN)

Sector: Pharmaceuticals

| Field | Value |
|---|---|
| Price | $168.18 |
| Fair value (Analysts) | $184.00 |
| Discount to fair value | 8.6% |
| Fair value uncertainty (Analysts) | Medium |
| Economic moat (Analysts) | Wide |
| LSEG analyst rating (1 strong buy to 5 strong sell) | 1.86 |
| Data as of | 2026-10-15 |
| Next earnings | 2026-10-30 (confirmed) |

## In short

After three large trial failures in 2026, the market doubts the 2030 revenue goal, and good trial results with steady growth over the next four to six quarters can close the gap.

## Themes and gap

- Themes: Regulation and courts (regulation-legal), China and geopolitics (china-geopolitics), Tariffs and trade (trade-tariffs)
- Gap type: Can close (closable)
- Why: The Q3 report on October 30, 2026, the 2027 guidance, and many trial results over the next 18 months show whether the pipeline can reach the 2030 goal.

## About

AstraZeneca is a global drug company based in Cambridge, UK. It discovers, develops, and sells prescription medicines in more than 125 countries. Its largest area is cancer medicines, such as Tagrisso, Imfinzi, Enhertu, and Datroway, which gave $12.9 billion of its $30.7 billion of revenue in the first half of 2026. It also sells medicines for rare diseases, and for heart, kidney, lung, and immune diseases, such as Farxiga, Breztri, and Ultomiris. The US gave $12.9 billion of revenue in the first half of 2026, and emerging markets, including China, gave $8.3 billion. AstraZeneca makes money from sales of medicines protected by patents, and it must replace sales when patents end and generic drugs arrive. It spends a large part of its revenue on research and development, and it buys or licenses drugs from other companies to fill its pipeline. It has a goal of $80 billion of total revenue in 2030.

## Thesis

The market prices AstraZeneca at a discount because it doubts that the pipeline can deliver the $80 billion revenue goal for 2030. Part of the value of the stock depends on drugs that are still in trials. Three large trials failed in 2026. On July 9, the Wainua heart trial (CARDIO-TTRansform) did not meet its main goal, and the shares fell about 9% in early trading. In August, AstraZeneca stopped a Phase III lung cancer trial of volrustomig, and in September, the SERENA-4 breast cancer trial of Etcamah did not meet its main goal. After the Wainua result, HSBC cut its rating to Hold and said that the 2030 goal depends on a group of higher-risk trials. At the same time, Farxiga lost US patent protection and China price cuts (volume-based procurement) reduce sales of older drugs. For the gap to close, three things must be true. Revenue must keep growing by a mid-to-high single-digit percentage and Core EPS by a low double-digit percentage in 2026, as guided on July 27. Most of the more than twenty important trial results that AstraZeneca expects over the next 18 months must be positive, mainly in cancer. New drugs such as Enhertu in early breast cancer, Datroway, and Baxfendy must grow fast enough to replace the lost Farxiga sales. The first check is the Q3 2026 report on October 30, 2026, and then the 2027 guidance with the full-year report, expected in February 2027. If the trials and launches go well, the gap can close over the next four to six quarters. If more large trials fail, the market can keep a lower value on the pipeline for longer.

## Checkpoints

- Oct 30, 2026: Q3 2026 results: growth without Farxiga and pipeline news. Status: Pending. Watch: Revenue growth at constant exchange rates in the mid-to-high single digits with the 2026 guidance kept passes; a cut to guidance or slower growth of the new cancer drugs fails.
- Feb 2027 (estimate): FY 2026 results and 2027 guidance. Status: Pending. Watch: 2027 guidance for revenue and Core EPS growth that keeps the $80 billion goal for 2030 in reach passes; lower guidance or a weaker 2030 goal fails.
- Q2 2027 (estimate): Next group of Phase III results. Status: Pending. Watch: Positive results in most of the important trials that AstraZeneca expects over the next 18 months pass; another large Phase III failure fails.

## Balance sheet

- Cash: $5.0B
- Debt: $29.5B
- Net debt: $24.5B
- EBITDA, last 12 months: $20.3B
- Net debt / EBITDA: 1.2× (low)
- Interest cover: 11×
- Undrawn credit line: $4.9B, to April 2031
- Debt due within 12 months: $5.8B
- Ratings: Moody's A1, S&P A+

AstraZeneca funds itself with bonds, commercial paper, and cash from its medicines. At June 30, 2026, gross debt was $32.2 billion including $2.7 billion of lease liabilities, and debt here excludes the leases. Net debt, as the company states it, was $26.9 billion, up $3.5 billion in six months. It includes leases and nets $0.4 billion of derivatives. EBITDA is for the 12 months to June 30, 2026, from the FY 2025 and H1 2026 reports. Interest cover is reported operating profit divided by net finance expense for H1 2026. Debt due within 12 months is the overdrafts, commercial paper, and current loans at June 30, 2026; the company says $6.2 billion of borrowings are due within one year. The committed bank facilities have no financial covenants. After June 30, AstraZeneca issued €2.55 billion of bonds on September 1, 2026, and paid $2 billion for Summit Therapeutics shares on October 5, 2026. The ratings did not change in the first half of 2026.

As of 2026-06-30.

Sources:

- https://www.sec.gov/Archives/edgar/data/901832/000110465926086846/azn-20260630x6k.htm
- https://www.sec.gov/Archives/edgar/data/901832/000165495426001073/a3234s.htm
- https://www.sec.gov/Archives/edgar/data/901832/000165495426007840/a9590r.htm
- https://www.sec.gov/Archives/edgar/data/901832/000165495426008783/a6290x.htm

## Recent events

- 2026-10-05: AstraZeneca completed a $2 billion equity investment in Summit Therapeutics. The two companies will test Summit's PD-1/VEGF antibody ivonescimab together with AstraZeneca's antibody drug conjugates, first in stomach and gut cancers. On October 2, AstraZeneca and Daiichi Sankyo also agreed to test Datroway with ivonescimab.
- 2026-09-14: The SERENA-4 Phase III trial of Etcamah (camizestrant) with palbociclib in first-line advanced ER-positive breast cancer did not meet its main goal of longer progression-free survival. Etcamah stays approved for patients with an ESR1 mutation, based on the SERENA-6 trial.
- 2026-09-08: AstraZeneca reported that Imfinzi with Imdelltra gave a statistically significant improvement in overall survival in small cell lung cancer. On September 7, the US approved Etcamah with a CDK4/6 inhibitor for first-line advanced breast cancer with an ESR1 mutation.
- 2026-08-25: AstraZeneca priced €2.55 billion of bonds in four parts, due from 2030 to 2038, with coupons from 3.402% to 4.169%. The bonds were issued on September 1, 2026.
- 2026-08-17: AstraZeneca stopped the eVOLVE-Lung02 Phase III trial of volrustomig with chemotherapy in first-line lung cancer, because the data monitoring committee said that it was unlikely to meet its main goals. On the same day, it reported positive Phase III results for Enhertu and for Tagrisso with Orpathys in lung cancer.
- 2026-07-27: AstraZeneca reported H1 2026 results. Total revenue was $30.7 billion, up 6% at constant exchange rates, and Core EPS was $5.21, up 11%. It kept its 2026 guidance and said that it is on track for its $80 billion revenue goal for 2030. It raised the interim dividend to $1.06 per share.
- 2026-07-09: The CARDIO-TTRansform Phase III trial of Wainua in transthyretin amyloid cardiomyopathy did not meet its main goal. The shares fell about 9% in early trading in London. On July 13, HSBC cut its rating to Hold.

## Risks

- High: The 2030 revenue goal depends on many trials that are still running. Wainua, volrustomig, and Etcamah had Phase III failures in 2026. More failures can lower the value that the market gives to the pipeline.
- Medium: Older drugs lose sales. Farxiga lost US patent protection, and China volume-based procurement cuts the prices of several older drugs. New drugs must grow fast enough to replace these sales.
- Medium: The US gave about 42% of revenue in the first half of 2026. US drug price rules, Medicare price talks, and tariffs on imported medicines can reduce prices and profits.
- Medium: China is a large market for AstraZeneca. Political tension, price cuts, and government investigations in China can reduce sales there.
- Low: Net debt rose by $3.5 billion in the first half of 2026 to $26.9 billion, and the $2 billion Summit investment adds to the cash outflow. More large deals can slow the fall of debt.

## Links

- Page: https://picks.kamadorueda.com/company/AZN/
- History of changes: https://picks.kamadorueda.com/company/AZN/history/
- JSON with full history: https://picks.kamadorueda.com/data/company/AZN.json

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