Equity research analysts at HSBC have cut their investment rating on biotech company Shire (LON:SHP) to 'hold' (from 'buy') saying the valuation does not look compelling on an absolute or relative basis.
HSBC also highlighted risks on Baxalta and haemophilia pricing, which it believes are not fully reflected in the shares.
It added: "Shire trades at a small discount to the European Pharmaceutical sector average on a 2017e core P/E basis.
"However, the valuation is less compelling on price/cashflow, EV/sales and EV/EBITDA metrics, in our view."
The bank has cut its target price to 5,250 pence a share from 5,400 pence.
At 2:24pm: (LON:SHP) Shire PLC share price was -86p at 5122p