Fri Sep 20 07:40:46 UTC 2024: ## Haleon Stock Gets Boost from Morgan Stanley, but Valuation Concerns Remain

**London/New York, [Date]** – Morgan Stanley has raised its price target for Haleon PLC (HLN:LN) (NYSE: HLN) to GBP4.15, citing strong market share trends and anticipated growth in the second half of the year. Despite this positive outlook, the firm removed Haleon from its Top Pick list due to the stock’s recent re-rating, which values the company at a premium compared to its European Staples peers.

The firm expects Haleon to continue outperforming its European Staples peers, predicting an acceleration in volume and growth, with organic growth projected at +6.5% in the second half of the year compared to +3.5% in the first half. This growth is attributed to easier comparators and is anticipated to contribute to the company’s continued sector dominance.

While Morgan Stanley maintains its Overweight rating, citing Haleon’s consistent performance and strong visibility on top-line growth, the firm acknowledges that Haleon’s current valuation, at roughly 20.5 times its calendar year 2025 price-to-earnings ratio, represents a significant premium.

Haleon’s recent developments include a dual-tranche bond offering, with proceeds intended for general corporate purposes, and the launch of Eroxon®, an over-the-counter gel for erectile dysfunction, expected to be available in the United States in October 2024.

Other analysts have also weighed in on Haleon’s prospects. BofA Securities has maintained a Buy rating and increased its price target to £4.40, highlighting the company’s potential for strong growth. Goldman Sachs, however, downgraded the stock to Neutral, while Berenberg initiated coverage with a Buy rating.

Despite the positive outlook from some analysts, Haleon’s valuation remains a key concern for investors, particularly given its premium compared to its peers. The company’s strong performance, new product launches, and corporate restructuring efforts will be key factors to watch as it navigates the market in the coming months.

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