GlaxoSmithKline: Not a well prepared quarterly report in our view
NEUTRAL, Fair Value 1810p vs. 1870p (+15%)
In our view communication around these quarterly numbers has not worked well. Accounting changes for post-retirement medical obligations have created swings in earnings for more than a year now but GSK has failed to provide a clear view about how this could play out at least on an annual basis. In Q3, these changes played a very positive a role but also gave the impression they were artificially offsetting an underlying business that was well below estimates and could also create doubts about guidance. This also diverts attention from key topics which is unfortunate since we see significant growth ahead.
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