UBS Warburg downgraded Kos Pharmaceuticals (KOSP) to neutral from buy.
Analyst C.J. Sylvester says Kos is fully valued after a recent run-up, and he sees limited near-term stock price appreciation. Sylvester notes Kos is now trading close to his $26 12-month target. He notes patent risk to Niaspan and the decelerating cholesterol market continue to be clouds looming over the stock. He continues to believes, however, that Kos should achieve more than 20% top-line growth over the next three years, and greater than 50% earnings per share growth in 2004.
Sylvester maintains his $26 12-month target. He sees 77 cents 2003 earnings per share, and $1.17 for 2004.