Analyst Tim Anderson on AstraZeneca: The long, slow crawl out

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AstraZeneca offices in England. The firm, which also has facilitiesin Delaware, announced more job cuts.

AstraZeneca, which had two announcements this week about staff cuts, also tried to spread a little pharmaceutical sunshine with an investor day in New York.

"There were no major surprises or sudden solutions – which we weren't expecting anyway – suggesting a long, slow crawl out from beneath a host of past problems," Bernstein Research analyst Tim Anderson wrote in a note to clients. "Many of the proposed solutions appear reasonable (and in-line with expectations) yet some of them will probably be viewed by investors with a measure of caution and skepticism.

"On balance, we continue to think AZN is likely "at the bottom" and that the dividend is safe (current yield ~6%). This makes it tempting given low investor expectations and AZN's low relative valuation. The downside is that the stock stays at the bottom for a prolonged period because solutions like these generally play out only slowly, and that investors only earn their ~6% during this period of gradual rebuilding. Furthermore, earnings will very likely continue to go down for a number of years before they go up again."

Here is a link to the slides portion of the company's presentation.

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